Event Driven Takeaways
- While there is positive momentum around the regulatory review of Bayer’s latest BASF divestitures, some questions remain in the EC regarding the digital agriculture space.
- Some third parties have noted that they have been contacted by the European Commission about Bayer’s latest commitments.
- An antitrust attorney following the deal told Event Driven that now is “the approximate time” for discussions between senior staff at the EC and DOJ about the adequacy of the companies’ commitments.
While there is positive momentum around the regulatory review of Bayer’s latest BASF divestitures, some questions remain in the digital agriculture space. Several third parties were contacted by the European Commission last week to comment on Bayer’s latest commitments to resolve the potential harm of the deal on the digital agriculture space, according to several sources close to the matter.
While the EC is soliciting the feedback from market participants on the merger commitments as part of its review, it is unknown how the commission will weigh the views of the specific entities it has contacted when coming to its final decision. These parties were largely against the current structure of the digital farming licensing plan, and may not have significant sway on the EC process.
The commission contacted several organizations and experts on Feb. 5 and 6 of last week, including Pat Mooney of the ETC Group, for their thoughts on Bayer’s commitments to give rival BASF an exclusive license to its digital farming platform, according to Mooney.
Mooney, as well as others contacted at the international panel of agricultural experts known as IPES Food, responded to the EC inquiry late last week saying that Bayer’s commitments do not adequately address the deal’s perceived antitrust harms to the digital agriculture industry.
“Both companies would have to surrender their digital platforms for this to be more acceptable,” according to Mooney, founder of the ETC Group and a panelist at IPES. “Although this is a very interesting step in the right direction.”
These sentiments were shared by Food & Water Watch, an advocacy group that has written to both the EC and DOJ opposing the deal throughout the agencies’ reviews of the transaction, and that advocates for aggressive divestitures in digital ag, according to a Food & Water Watch spokesperson.
Some, such as Professor Rebecca Bratspies at CUNY School of Law, say that one way to address these concerns would be for the companies to divest portions of their digital ag portfolios to a variety of market players.
On Feb. 2, Bayer submitted several commitments to the EC as part of the company’s attempts to win antitrust clearance for its Monsanto purchase. The commission
began the market-testing phase of its review early last week, contacting market participants for their thoughts on these commitments. The EC now has until April 5 to reach a decision on the deal.
As Event Driven
previously reported, DOJ antitrust chief Makan Delrahim plans to travel this week to meet with EC Commissioner Margrethe Vestager and Andreas Mundt, president of Germany’s Bundeskartellamt. The matter of Bayer’s latest commitments for its Monsanto deal “may come up” on the trip, Delrahim told Event Driven.
“It’s the approximate time for the agencies to have some sort of discussion,” according to an antitrust attorney who has been following the deal. “And at least at the staff level, I would imagine that’s been the case for longer.”
Neither Bayer nor Monsanto could be reached for comment in time for publication. The DOJ and EC declined to comment.
--Matt Tracy and Nils Tracy