This story has been updated from a previous version.
NEW YORK, Oct. 2 – Bayer said Tuesday that it had agreed to acquire Aventis CropScience from Aventis and Schering for 7.25 billion euros ($6.63 billion), including debt, a deal that will propel Bayer to the number two spot in the agrochemicals sector.
“The idea is to form a combined business between Bayer and Aventis that will combine our crop protection business with seed technology and biotechnology,” a Bayer spokesman said. “By combining these three parts, we are convinced that this is an important step into the future.”
The Bayer spokesman said, however, that it was too early to disclose specifics about how the acquisition would affect its agrigenomics capabilities.
“We have just signed the deal and it will take a lot of time to integrate the units,” the spokesman said. “After closing we will have more details.”
The transaction, which represents Bayer's largest acquisition and includes 1.9 billion euros in debt, is expected to close during the first quarter of 2002.
Previously, an Aventis CropScience genomics executive told GenomeWeb that some 1,200 of the company’s 15,000 employees worked in research and development and that slightly less than 10 percent of the company’s research was focused on genomics.
Aventis CropScience also has a number of academic and corporate partnerships in genomics that could potentially be affected by the merger. Aventis is involved in three collaborations with German and French consortia in the area of genomics research and owns 50 percent of a joint venture with Exelixis.
In 1999, Exelixis subsidiary Exelixis Plant Sciences and Aventis CropScience formed Agrinomics, a 50-50 collaboration designed to study arabidopsis and plant traits.
Bayer also has a joint venture with Exelixis called Genoptera, which is focused on developing technologies that can be used to develop insecticides.
Glen Sato, Exelixis’ chief financial officer and vice president of legal affairs, said that he was optimistic about the continuation of the deals, although some uncertainty surrounds the future of the Agrinomics collaboration.
“In net terms we see this [deal] as a positive and I say this because of the closeness of our relationship with Bayer,” Sato said. “It’s slightly different with Agrinomics because Bayer has looked at it from the point of view of due diligence, but the strategic level will be the next level of review.”
Sato declined to comment on the value of the Agrinomics partnership to Exelixis except to say that the joint venture has done some “very valuable” work.
Bayer of Leverkusen, Germany said it would reorganize its expanded crop science business, which was previously ranked seventh in the sector, into a new business unit called Bayer CropScience.
The acquisition of Aventis CropScience is designed to help Bayer to cut costs and boost revenues in its agriculture business. The company is expected to take restructuring charges of about 500 million euros as it trims 4,000 jobs, or about 15-18 percent of CropScience’s and Bayer’s combined workforce in crop protection.
"Acquiring Aventis CropScience will make us a world leader in crop science and substantially boost Bayer's earning power," Manfred Schneider, chairman of the board of management of Bayer, said in a statement.
Syngenta of Switzerland is the leading agrichemicals company in a sector valued at an annual $33 billion.
Bayer CropScience will be headed by Jochen Wulff, who is currently the general manager for Bayer's Crop Protection Business Group. Bertrand Meheut, CEO of Aventis CropScience, will work with Wulff during the integration process, Bayer said.
Bayer expects combined sales to amount to 6.5 billion euros – 7 billion euros this year.
Bayer CropScience will be headquartered in Monheim, Germany.
Aventis previously owned 76 percent of CropScience and Schering owned the remaining 24 percent.