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By Casey Wooten
Sept. 14 — Senate Judiciary Committee Chairman Charles Grassley (R-Iowa) is calling in the executives of agribusiness and chemical giants involved in major merger deals to testify on consolidation in the sector.
The senator's Sept. 14 announcement comes the same day that the German chemical company Bayer AG said U.S. crop biotechnology company Monsanto Co. accepted its $66 billion acquisition bid (see related stories here, here and here). That announcement follows on the heels of similar proposed deals between China National Chemical Corp. and Syngenta AG, and between DuPont Co. and Dow Chemical Co.
“As mergers continue to occur in the seed, agro-chemical and fertilizer industries, federal antitrust regulators must be ever more vigilant to ensure a robust competitive environment in this important sector,” Grassley said in a statement on the Bayer-Monsanto deal.
“With several proposals under review, it’s crucial that the antitrust authorities collaborate as appropriate with each other, and the Department of Agriculture, in their analysis to ensure that competition is preserved for farmers and consumers,” the statement added.
Grassley has scheduled a hearing Sept. 20 to examine consolidation in the seed and agro-chemical industries. Executives of major players in recent proposed deals are expected to testify, including Erik Fyrwald, CEO of Syngenta; Jim Blome, president and CEO of Bayer CropScience North America; and Dr. Robert Fraley, executive vice president and chief technology officer of Monsanto.
DuPont and Dow executives are also on the list.
Grassley has been a vocal critic of recent M&A deals in the sector and has pushed for the Agriculture Department to sit on a multi-agency board known as the Committee on Foreign Investment in the U.S. (CFIUS), which examines the national security impact of deals involving foreign companies purchasing either a U.S. firm or a company that has significant U.S. assets. The USDA doesn't typically sit on the CFIUS panel.
Grassley hasn't said whether he would push to include the Agriculture Department in any possible review of the Bayer-Monsanto acquisition. However, in July, Grassley introduced legislation that would permanently add the USDA to the nine-member panel (See previous story, 07/15/16).
The National Farmers Union echoed Grassley's concern over the Bayer-Monsanto deal and of the broader mergers and acquisitions climate in agribusiness.
“For the last several days our family farm and ranch members have been on Capitol Hill asking Members of Congress to conduct hearings to review the staggering amount of pending merger deals in agriculture today,” NFU said in a Sept. 14 statement. “We will continue to express concern that these megadeals are being made to benefit the corporate boardrooms at the expense of family farmers, ranchers, consumers and rural economies.”
The American Soybean Association, whose members rely heavily on the bioengineered products provided by Monsanto, said it was examining the deal to determine if it would hurt competition.
“ASA intends to closely analyze the potential impacts of this proposed merger on soybean farmers to provide comments to the companies and U.S. regulatory authorities that must approve any acquisition, including the Justice Department,” the trade group said in a Sept. 14 statement.
To contact the reporter on this story: Casey Wooten in Washington at email@example.com
To contact the editor responsible for this story: Heather Rothman at firstname.lastname@example.org
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