State attorneys general joining merger probes

Sen. Grassley presses Department of Justice to scrutinize deals.

U.S. state attorneys general have joined a federal antitrust probe of the planned merger between DuPont and Dow Chemical Co., three people familiar with the matter have told Reuters. One of the sources also said a separate group of state attorneys general is expected to join a probe of Bayer AG's plan to buy Monsanto Co.

About seven states, including California, have joined the probe of Dow's planned merger with DuPont, while the number of states joining the Bayer-Monsanto merger investigation is still unknown, Reuters reported.

States are concerned that pesticide and herbicide prices will rise following the mergers. Additionally, there is concern that the companies will have less incentive to introduce new and cheaper products, the sources told Reuters.

DuPont and Dow told Reuters they expect to win approval for their deal. "In the U.S., we are working constructively with federal and state regulatory authorities, elected officials and all agriculture stakeholders to show the pro-competitive benefits of the merger," the companies said.

Bayer said in a statement to Reuters that it looks forward to "working diligently with regulators to ensure a successful close." Monsanto did not respond to a request for comment.

Sen. Chuck Grassley (R., Iowa) is also pressing the U.S. Department of Justice to scrutinize the proposed Bayer-Monsanto deal as it continues to examine other proposed mergers and acquisitions in the agrochemical and seed industries.

In a recent letter to the DOJ Antitrust Division, Grassley expressed concerns that a Bayer-Monsanto combination could vertically integrate traits, seed and chemicals; raise barriers to entry in the market for smaller companies; curtail chemical and seed choices; raise prices for farmers and consumers, and harm research, development and innovation.

Grassley noted that a Senate Judiciary Committee hearing on these deals last month "shed light on multiple concerns raised by farmers and consumers. As these deals are analyzed and dissected, it’s imperative that they are not evaluated in a vacuum. We owe it to the American people to study the potential long-term effects of these proposed deals on competition and innovation in the agriculture sector.”

As chairman of the Senate Judiciary Committee, Grassley led the hearing to provide transparency to the many mergers and acquisitions taking place in the agrochemical and seed industries. Grassley also recently sent a letter to Ren Jianxin, chairman of ChemChina, asking him to respond to outstanding questions for the record that Syngenta was not able to answer about the merger of the two companies.

Hide comments

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish