Following a consolidation trend globally in the agro chemicals and seed sector, Bayer and Monsanto announced a merger on Wednesday, where the former will pay 44 per cent higher price to Monsanto shareholders. While both companies are present in India and their Indian arms are listed, the share prices of both went up on the day with Monsanto India surging 9.9 per cent, while Bayer Crop Science surged 1.1 per cent.
Analysts, however, feel there will be a limited impact of the merger on India’s seed, agro chemicals and crop science sector. Deven Choksey, managing director, KR Choksey Investment Managers, said, “Globally, consolidations are happening as companies don’t have visibility of growth.” However, in India, according to him, seed and agro chemicals have largely grown in the generic segment. Growth of patented products in India has been limited. Monsanto is a leader in the GM cotton seed technology. But, it announced last month that it has withdrawn an application to sell a new variety of genetically modified cotton seed in India because of concerns over the government’s alleged attempt to restrict the biotechnology business.