BASF Is Said to Progress in Bayer Auction for Seed Businesses

Sep 20, 2017 5:27 pm ET

(Bloomberg) -- BASF SE has progressed in an auction for a package of Bayer AG seed assets, according to people with knowledge of the situation, signaling a change in tactics for the German company as it considers diversifying from its core chemical products.

Rival suitors DowDuPont Inc. and Syngenta AG are also competing for the canola, cotton and soybean seed varieties, as well as the Liberty herbicide unit, said the people, who asked not to be identified because the bidding is private.

The asset sales, part of Bayer’s planned $66 billion purchase of Monsanto Co., are part of a wave of consolidation that’s creating integrated seed and agrochemical giants and forcing Ludwigshafen-based BASF to rethink its stance on shunning seeds. Having explored combinations with DuPont and Monsanto in the past, BASF sees Bayer’s antitrust-driven asset sales as a way into the market at this late stage, said the people.

Under Chief Executive Officer Kurt Bock, BASF’s strategy until recently has been to focus on the firm’s core expertise in chemistry, rather than diversify into biology and genetically modified crop varieties. Still, after years of sticking to developing fungicides and crop-protection chemicals, Chief Technology Officer Martin Brudermueller said BASF was looking to see whether seeds “makes sense” in a June interview.

Bayer has increased the size of the package of assets it’s divesting, adding soy to help persuade regulators that competition in that industry would be protected, said the people.

Representatives for Bayer, BASF and Syngenta declined to comment. DowDuPont didn’t immediately respond to requests.

--With assistance from Jack Kaskey

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