Monsanto Co. announced July 19 that its board of directors has rejected Bayer AG’s revised proposal as financially inadequate and insufficient to ensure deal certainty. The most recent all-cash offer from Bayer increased the bid for Monsanto from $122 to $125 per share and represented a premium of 40% over Monsanto’s share closing price on May 9, 2016.

Despite rejecting the offer, Monsanto said it remains open to "continued and constructive conversations" with Bayer and other parties to assess whether a transaction that the board believes is in the best interest of Monsanto shareowners can be realized. "There is no assurance that any transaction will be entered into or consummated or on what terms," the company said.

Bayer said it is disappointed in Monsanto’s decision to reject the increased offer.

“The revised all-cash offer is a compelling opportunity and represents immediate and certain value for Monsanto shareholders amid recent weak business performance and Monsanto’s reduced midterm outlook,” Bayer said.

The company reaffirmed that its offer would not be subject to a financing condition. Additionally, Bayer said it has offered a $1.5 billion reverse antitrust breakup fee, reaffirming its confidence in a successful closing.

“Bayer is looking forward to continued dialogue with Monsanto under an appropriate confidentiality agreement allowing access to additional information,” the company added.

Numerous analysts have suggested that Bayer will need to offer $130-140 per share to strike a deal.

Morgan Stanley & Co. and Ducera Partners are acting as financial advisors, and Wachtell, Lipton, Rosen & Katz is acting as legal advisor to Monsanto.