Bayer's market capitalization is now close to the price it pays monsanto

one of the worst corporate deals in modern history? In Bayer's acquisition of Monsanto, that meant the value of the entire company had plummeted.
Bayer bought Monsanto for $63 billion in 2018 after a tough takeover battle and intense antitrust scrutiny. The German group's market capitalisation in Frankfurt today is close to that amount - after rumours that an $8bn consolidated settlement in early August had pushed its share price up by more than 15 per cent.
The Wall Street Journal found that the deal, which has fallen 30 percent since its end, was one of the worst, with the merger of AOL and Time Warner and Bank of America's nationwide acquisition. The Monsanto acquisition, backed by chief executive Werner Bowman, did boost Bayer's crop science business. But the initial idea was that it would not hinder the company's ability to invest in pharmaceuticals, which have been Bayer's growth engine for years.
The two companies reached an agreement in September 2016 after Bayer raised its offer several times. But antitrust pressure delayed the acquisition, and Bayer eventually agreed to sell $9 billion worth of assets to please the U.S. Department of Justice.But at the same time, lawsuits are advancing over claims that Monsanto's Rundup herbicides cause cancer - and Bayer will soon feel their sting.
Related:With the elimination of animal health division Bayer reached an agreement with Elanco for $7.6 billionIn August last year, a california jury upon the plaintiffs and ordered Bayer to pay $289 million in damages
The Wall Street Journal, citing senior executives, said investors and Bayer directors were concerned about the first loss, even though the judge later reduced the payment to $78.5 million.
Concerns about Bayer's acquisition of related debt have resurfaced after the failed trial. Analysts point out that Bayer's pharmaceutical pipeline is too weak to fill the gap because its best-selling drugs, the blood thinner Xarelto and the eye drug Eylea, will lose patent protection in 2023. As a result of Monsanto's deal, the company does not have enough cash to complete any significant pharmaceutical transactions.
In the face of investor pressure, Last year Mr Bowman's management team unveiled a major restructuring plan aimed at saving 2.6bn euros in annual costs. Since then, the company has ditched sun protection line Coppertone and foot care brand Dr. Scholl's signed an agreement to sell its animal health business to Elanco for $7.6 billion.
Despite the reforms, especially as Monsanto faces mounting litigation, shareholders remain unhappy with Bowman's leadership. When it comes to Bayer's annual meeting in April, 55.5 per cent of angry shareholders voted in a rare vote of no confidence in Bayer's management. About a third of investors voted against the supervisory board, led by Chairman Werner Wenning, who also backed Monsanto's deal. In the five years from 2014 to 2018, more than 90 percent of the votes were cast in support of Bayer's leadership team, according to a recount by the Wall Street Journal.
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AnalysisStarts with

Simple Thingsand then breaks upThe number of legitimate lawsuits continues to rise, reaching 18,400 as of July 11, Bayer has successfully reduced two comprehensive damages.In early August, Bloomberg reported that Bayer had offered to pay up to $8 billion to settle all of these lawsuits. According to the Wall Street Journal, the rumor helped Bayer's stock break away from a seven-year low in June, although the mediator denied this.Meanwhile, Bernstein analysts are calling for a quick and quick settlement so Bayer can focus on its business. One of the long-term remedies they have proposed is a further two-way separation between the pharmaceutical and crop businesses. （cyy123.com）