FRANKFURT, Germany (AP) — German drug and farm chemical maker Bayer AG says it has agreed to acquire seed and weed-killer company Monsanto in an all-cash deal valued at $66 billion.

Bayer says it is paying Monsanto shareholders $128 per share, which represents a 44 percent premium over Monsanto's closing price on May 9, the day before a proposed deal was announced.

The deal is subject to approval by Monsanto shareholders and anti-trust regulators.

Bayer said Wednesday the transaction brings together two different but complementary companies. Bayer makes a wide range of crop protection chemicals, while Monsanto is known for its seeds business.

Leverkusen-based Bayer said the merged companies' agriculture business would have its seeds business and North American business headquarters in St. Louis, Missouri, where Monsanto is currently based.

Bayer initially offered $122 per share, only to be rebuffed by Monsanto management, and then $125 per share before reaching the deal announced Wednesday.

Monsanto Chairman and CEO Hugh Grant said the deal "represented the most compelling value for our shareholders, with the most certainty through the all-cash consideration."

Bayer said it would raise the cash to pay for Monsanto by issuing debt and $19 billion in equity, including a mandatory convertible bond and a rights issue. </s> German drug and farm chemical company Bayer AG said Wednesday it has signed a deal to acquire seed and weed-killer company Monsanto for $66 billion in cash.

Bayer said it is paying Monsanto shareholders $128 per share, which represents a 44% premium over Monsanto's closing price on May 9, the day before a proposed deal was announced.

The deal is subject to approval by Monsanto shareholders and antitrust regulators.

Bayer said the transaction brings together two different but complementary companies. Bayer makes a wide range of crop protection chemicals, while Monsanto is known for its seed business.

Leverkusen-based Bayer said the merged companies' agriculture business would have its seed business and North American business headquarters in St. Louis, where Monsanto is based.

Bayer initially offered $122 per share, only to be rebuffed by Monsanto management, and then $125 per share before reaching the deal announced Wednesday.

Monsanto Chairman and CEO Hugh Grant said the deal "represented the most compelling value for our shareholders, with the most certainty through the all-cash consideration."

Bayer said it would raise the cash to pay for Monsanto by issuing debt and $19 billion in equity, including a mandatory convertible bond and a rights issue.

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5:35 a.m.: This article has been updated with additional information.

This article was originally published at 5 a.m. </s> The $63.5 billion offer on the table for U.S. seed giant Monsanto was already the biggest takeover bid this year. But in an effort to clinch a deal, Germany's Bayer says it's ready to go even bigger.

Bayer (BAYRY) said Tuesday it's prepared to pay $65 billion in cash to create a huge conglomerate spanning pharmaceuticals, health products and pesticides.

Monsanto (MON) shot down Bayer's two previous offers, but now the companies are in advanced talks, the German firm said.

It's not the only one interested, though, according to Monsanto. The U.S. company said its weighing Bayer's sweetened offer along with "proposals from other parties and other strategic alternatives."

Related: Monsanto takeover would be biggest deal of 2016

Bayer is now offering $127.50 per share, up from previous bids of $122 and $125. Monsanto shares in New York closed Friday at $107.44, suggesting investors were cautious about the prospects of a successful deal.

The latest offer values Monsanto's equity at about $56 billion. Including debt, the deal would be worth $65 billion.

If the two companies can reach an agreement, it would be the latest mega-merger struck in the agribusiness and chemical sectors. Last year, Dow and DuPont combined to form a new industrial giant worth $130 billion.

In February of this year, ChemChina agreed to pay $43 billion for Syngenta (SYENF), a company that Monsanto had previously tried to buy.

The ChemChina-Syngenta deal is currently the biggest announced worldwide so far this year.

Bayer, which is strongest in Asia and Europe, stands to gain from Monsanto's expertise in agriculture and seeds. It would also benefit from Monsanto's regional strength in North America.

Bayer has said the combining the companies -- which would need regulatory approval -- would generate synergies of $1.5 billion over three years.

-- Charles Riley and Rob McClean contributed to this report. </s> FRANKFURT/NEW YORK (Reuters) - Chemicals and healthcare group Bayer AG (BAYGn.DE) is poised to announce the acquisition of U.S. seeds company Monsanto Co MON.N on Wednesday for more than $66 billion, clinching the biggest deal of the year, people familiar with the matter said.

A trader works at the post where Monsanto Co. is traded on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., August 25, 2016. REUTERS/Brendan McDermid

By accepting Bayer’s offer, the largest cash acquisition proposal on record, Monsanto is set to give the German company a shot at grabbing the top spot in the fast-consolidating farm supplies industry, combining its crop science business with Monsanto’s strength in seeds. It will also set the stage for the deal to be closely scrutinized by antitrust regulators.

The breakthrough in negotiations, which follows more than four months of talks, came after Bayer further improved on the sweetened offer of $127.50 per share in cash it disclosed last week, the people said.

However, the deal will still value Monsanto at less than $130 per share, which the company was previously hoping to fetch, the people added.

Once St. Louis, Missouri-based Monsanto’s board of directors approves the deal on Tuesday, Leverkusen-based Bayer’s supervisory board will meet on Wednesday to also authorize the transaction, with an announcement expected before the stock market opens in New York on Wednesday, some of the people said.

It is still possible the board of either company could decide to walk away from the deal at the last minute, the people cautioned.

The sources asked not to be identified because the deliberations are confidential. Bayer and Monsanto declined to comment.

Monsanto’s shares ended 0.8 percent lower at $106.10 in New York on Tuesday amid uncertainty over whether any agreed deal will clear antitrust hurdles. The stock later climbed to $108.79 in after-hours trading. Bayer shares ended trading in Frankfurt down 0.3 percent at 93.3 euros.

Bayer said last week talks with Monsanto had advanced and that it was willing to offer $127.50 per share, up from $125 previously, valuing Monsanto at more than $65 billion, including debt.

Sources told Reuters that topping up the price secured Bayer access to more privileged information on Monsanto’s business performance and paved the way for more detailed negotiations.

“Given recent updates on the Monsanto approach suggest a final conclusion may be close, we suspect (Bayer) will work hard to try and reach a final conclusion before the Meet Management event, if possible,” Jefferies Research analyst Jeffrey Wolford said in a research note before the news, referring to Bayer’s presentations day for analysts and investors in Cologne next Tuesday.

Bayer’s bid to combine its crop chemicals business, the world’s second-largest after Syngenta AG SYNN.S, with Monsanto’s industry leading seeds business, is the latest in a series of major consolidation moves in the agrochemical sector.

U.S. chemicals giants Dow Chemical (DOW.N) and DuPont (DD.N) have agreed to merge and spin off their respective seeds and crop chemicals operations into a major agribusiness.

Syngenta last year fought off unwanted suitor Monsanto, only to later agree to a takeover by ChemChina.
Bayer reproposes to buy Monsanto at a new exchange of US$65 billion including debt.