Mofcom collects industry views on Bayer, Monsanto deal, with no strong opposition yet seen

2 March 2017. By MLex Staff.

China's Ministry of Commerce, or Mofcom, the country's merger control regulator, has started soliciting industry views on the proposed $66-billion acquisition of Monsanto by Bayer, MLex has learned.

The ministry has reached out to gather industry views on the mega-deal, and in January summoned several stakeholders to discuss the potential impact of the planned transaction, it is understood. It is not immediately clear what the stakeholders told the regulator at that meeting.

A focus of Mofcom's interest may be the potential impact of the transaction on the crop-protection and seed industries, MLex was told.

Months ago, the agency conducted an informal inquiry to gather general information about the operations of the two companies in China's seed industry.

Although deals involving the agricultural sector are likely to draw close scrutiny by the Chinese government, it seems that there hasn't emerged any strong opposition from players in either the crop-protection or seed industries so far, industry sources said.

The two companies have limited market shares in both of these industries, they said. Multinational companies only have a share of around 10 percent of the Chinese agrochemical market.

China's seed industry has not been fully opened to foreign companies and is still closely supervised by the government.

The companies announced their planned merger last September and expect to close the deal by the end of 2017. Shares in Monsanto are listed on the New York Stock Exchange. Bayer's stock trades on the Frankfurt Stock Exchange.

– Analysis by Yang Yue