Fox News was almost giddy with excitement when its headline blared: “Monsanto Shares Up on Bayer-Trump Promise for Billions in U.S. Investment, Jobs.” Actually, it was a repeat of a story Fox published on Tuesday.
But the commitment only came about after several days of meetings with Monsanto and Bayer CEOs and the president-elect and his senior transition staffers last week.
So I guess Trump had to promise the pesticide and seed giants everything but the moon in order to get them to commit to retaining the 9,000 jobs already spread across facilities in the United States, not that they were planning on taking them to other countries.
So it wasn’t too hard for the two companies to promise to invest $8.0 billion in research and promise to add an additional 3,000 high-tech jobs, if, and only if, their merger went through. And this is worrisome coming from the Trump transition team because of Trump’s campaign promises that would deregulate so many of our existing laws.
After several months of negotiations, in September 2016, German drug and farm chemical maker Bayer AG finally reached a deal with U.S. seed and weed killer company Monsanto to create a company that would control one-quarter of the world’s market for seeds and pesticides.
Then, on December 13, 2016, Monsanto shareholders voted to accept what had become a $57 billion merger with Bayer, with Monsanto saying at the time the merger wouldn’t take place until it gets final approval, possibly at the end of 2017. There is just one little thing the merger has to overcome, and that is getting approval from federal regulators.
Last month, Jim Nelson at Euro Pacific Capital said there is a very good chance the deal will be rejected on antitrust grounds. Speaking about all the mergers globally that have created monopolies, Nelson said, “There has been a lot of consolidation recently, so regulators will be very reluctant to approve the deal.”
So I am wondering just how much influence Trump will have on the SEC and other parties involved in scrutinizing the merger. But seeing as Trump has gotten promises of jobs and investments from General Motors and Wal-Mart, according to Reuters, who knows how the Monsanto-Bayer merger will come out?