GERMANY – Leading agrochemical company BASF has signed an agreement to acquire significant parts of Bayer’s seed and non-selective herbicide businesses, entering the key seeds business that it has been missing in its portfolio.

The acquisition of the assets, as Bayer divests from some key areas as it seeks to placate regulators concerns as it moves to complete the acquisition of seed and agrochemicals giant Monsanto, is valued at €5.9 billion (US$7 billion).

It comes at a time after Bayer, which has struggled to convince regulators in the key European Union market, received the commission’s decision to pause the hearing of its case, as it awaits more information from the company.

“With this investment, we are seizing the opportunity to acquire highly attractive assets in key row crops and markets.

It will be a strategic complement to BASF’s well-established and successful crop protection business as well as to our own activities in biotechnology,” said Dr. Kurt Bock, Chairman of the Board of Executive Directors of BASF SE.

“The acquisition will further enhance our agricultural solutions offer, which is a core pillar of BASF’s portfolio.”

The assets to be acquired include Bayer’s global non-selective commercial herbicide business under three brands, Liberty, Basta and Finale brands, and its seed businesses for canola hybrids in North America.

It also oilseed rape mainly in European markets, cotton in the Americas and Europe as well as soybean in the Americas, plus Bayer’s trait research and breeding capabilities for these crops and the LibertyLink trait and trademark.

The business to be purchased from Bayer amounted to around €1.3 billion and EBITDA of €385 million in 2016.

The transaction is subject to the closing of Bayer’s acquisition of Monsanto and approval by relevant authorities and is expected to close in the first quarter of 2018.

According to BASF, the acquisition complements its crop protection business, strengthens the company’s herbicide portfolio and marks its entry into the seed business with proprietary assets in key agricultural markets.

“We will offer farmers a greater choice of solutions addressing their needs for high-quality seeds, chemical and biological crop protection,” explained Saori Dubourg, Member of the Board of Executive Directors of BASF SE and responsible for the Agricultural Solutions segment.

“Moreover, this transaction will create new opportunities for future growth and strengthen our global innovation potential.”

According to the company, more than 1,800 commercial, research, breeding and production personnel shall transfer from Bayer to BASF, primarily in the United States, Germany, Brazil, Canada and Belgium.

BASF will also acquire the manufacturing sites for glufosinate-ammonium production and formulation in Germany, the United States, and Canada, seed breeding facilities in the Americas and Europe as well as trait research facilities in the United States and Europe.