Monsanto sale

S E RV I N G T H E P U B L I C S I N C E 1 878 • W I N N E R O F 1 8 P U L I TZ E R P R I Z E S

THURSDAY • 09.15.2016 • $1.50

HELLO BAYER

MONSANTO PURCHASED FOR $66 BILLION Largest ever all-cash merger faces anti-trust hurdles

Slight increase in offer wins over Monsanto board

BY JACOB BARKER St. Louis Post-Dispatch

For four months, the St. Louis area has watched as another of the region’s marquee corporate names moved closer to being swallowed up by a larger company.

The drama appears to have ended Wednesday, after German biotech giant Bayer won over Monsanto’s management with an offer of $128 a share in cash.

The $66 billion deal is the largest all-cash transaction on record, topping the prior record set in 2008 when brewer InBev bought Anheuser-Busch for $52 billion.

Buying Monsanto, the global seed market leader, will give Bayer more than a quarter of the world market for seeds and pesticides, both companies said Wednesday.

Creve Coeur-based

Merger creates seeds and crop chemicals giant

World HQ of Bayer’s seed business will be here

See BAYER • Page A4

Monsanto sale raises concerns about area jobs

BY LISA BROWN St. Louis Post-Dispatch

Monsanto’s looming sale to Bayer AG could have a significant impact on the St. Louis region, but neither company is providing specifics yet on potential job losses.

In announcing the deal Wednesday, Bayer and Creve Coeur-based Monsanto said the combined company’s seeds and traits business and its North American commercial headquarters would be based in the St. Louis area when the sale finalizes in 2017, while its global crop protection and overall crop science businesses will be based in Monheim, Germany. Bayer’s headquarters is in Leverkusen, Germany.

Bayer also said its crop science

Jobs, funding for charities here could face cutbacks

See JOBS • Page A5

WILL TAKEOVER CHANGE MONSANTO’S IMAGE? • CEO COULD REAP MILLIONS • TIMELINE • CHARITABLE GIVING QUESTIONS > PAGES A4-6

Lawmakers override Nixon on guns and voter ID

Schnucks, union spar over employee handbilling

BY KURT ERICKSON AND CELESTE BOTT St. Louis Post-Dispatch

BY LISA BROWN St. Louis Post-Dispatch

JEFFERSON CITY • Republicans

used their legislative muscle Wednesday to loosen state gun laws and require people to present photo identification when they head to the polls.

On a day dedicated to considering bills that were vetoed by Gov. Jay Nixon, a Democrat, the GOP used its wide majorities in the House and

Schnucks managers and union members faced off in court this week over whether the grocery store chain violated labor laws by ordering warehouse workers to stop handing out fliers at store entrances to protest job cuts.

One of the laid-off union employees testified he was thrown out of a

See VETOES • Page A8

See SCHNUCKS • Page A12

TODAY

SPORTS

83°/69°

Seed money

MOSTLY CLOUDY

TOMORROW

84°/68°

Cubs blank Cards

CHANCE OF STORMS

WEATHER A18 POST-DISPATCH WEATHERBIRD ®

Another election under scrutiny Clinton is deemed ‘fit to serve’

• A3

• A10

Powell emails criticize candidates

• A10

Blues’ Steen says rehab going well

1 M • B1

Vol. 138, No. 259 ©2016

BAYER BUYS MONSANTO

A4 • ST. LOUIS POST-DISPATCH

M 1 • Thursday • 09.15.2016

BAYER AG

MONSANTO CO.

Business: Global conglomerate primarily active in pharmaceuticals, health products and agriculture.

Founded: 1863 Headquarters: Leverkusen, Germany Chief Executive: Werner Baumann Employees: 116,800 Revenue: 46.3 billion euros ($51.6 billion U.S.) Net Income: 4.1 billion euros ($4.5 billion U.S.)

Business: Agribusiness giant most recognized worldwide for its biotech seed business and its Roundup herbicide.

Founded: 1901 Headquarters: Creve Coeur Chief Executive: Hugh Grant Employees: 20,800 (4,100 in St. Louis area) Revenue: $15.0 billion Net income: $2.3 billion

Baumann

Grant

Merger could aid two images

BY BRYCE GRAY St. Louis Post-Dispatch

C R E V E C O E U R • The an-

nounced $66 billion sale of Monsanto Co. to Bayer AG leaves many wondering about its impact on the futures of both companies. Beyond the finances, one question is whether the megascale merger of pharmaceutical and agricultural giants will do anything to change Monsanto’s controversial — and widely vilified — reputation worldwide.

From business experts to activists, some are skeptical that the deal will move the needle of some public sentiment, which they say remains weighted against the Creve Coeur-based company branded as “Monsatan” in some activist circles.

“I don’t think it’s really going to change their image,” said Doug Gurian-Sherman, the director of sustainable agriculture and a senior scientist at the Center for Food Safety. He said that both Monsanto and Bayer “have done things that, from our perspective, are not in the public’s interest.”

Skeptics say Monsanto won’t be helped by Bayer’s own past.

The German company has been linked to a number of controversial issues and products throughout its history — from production of the deadly gas used in Nazi concentration camps to its stance in the modern-day debate on genetically modified food.

“When you look at the history of Bayer, it’s almost as bad as Monsanto, in terms of spending huge amounts of money to resist genetically modified food labeling,” said Michael Hansen, a food safety and environmental health expert for Consumers Union.

Hansen said Bayer had a poor track record with genetically modified crops, pointing to a $750 million out-of-court set-

CHRISTIAN GOODEN • cgooden@post-dispatch.com

A grounds crew crosses on the Monsanto world headquarters campus in Creve Coeur on Wednesday.

implemented or proposed from Europe to Minnesota.

“It’s a troubling combination of toxins and more toxins,” said Gurian-Sherman.

Others are more optimistic about how Monsanto will fare after the merger, which is expected to close at the end of 2017.

“Monsanto’s image could only be helped by disappearing into Bayer, I would think,” said Carey Gillam, a director of the consumer group, U.S. Right to Know, who has researched Monsanto for nearly two decades.

She believes the benefits of merging with Bayer will be twofold. Besides shielding Monsanto from continued negative attention, she says the deal could also provide financial security at a time when the company’s marquee products face intense public scrutiny or outright bans in markets such as Europe.

tlement the company reached in 2011 after an engineered rice variety that was never approved for public consumption turned up in the commercial rice supply, ruining about half of long-grain rice exports from the United States and leading to international trade bans. The rice variety, known as LibertyLink 601, was grown only on test plots from 1998 to 2001, Hansen said, yet somehow resurfaced in rice exports five years later.

But the merger is perhaps most worrisome to environmentalists and scientists concerned about Monsanto, the world’s most prominent herbicide producer, joining forces with Bayer, manufacturers of widely used, controversial pesticides called neonicotinoids. Some studies suggest that the family of pesticides may harm pollinators such as honeybees, prompting bans to be

“Monsanto faces many challenges if they continue to push back against Bayer and opt for a standalone strategy as their rivals consolidate,” Gillam said. “Both of the company’s bread-andbutter product lines – its glyphosate herbicide and its GMO crops – are facing a host of challenges now and Monsanto’s efforts to develop new product lines and diversify its revenue stream so far have not proven successful.”

Wayne Keene, director of the Center for Sales and Customer Development at the University of Missouri-Columbia, says that the merger could provide Monsanto with a fresh start in terms of building its corporate reputation.

“I think that Bayer gives them the opportunity to reset the discussion,” said Keene.

Plus, he says the deal may expand the company’s marketing

possibilities. “Monsanto is looking at Bayer as a company that can give them opportunity and access to new growth,” Keene said.

The merger still needs approval from anti-trust regulators before being finalized. Anti-trust concerns not only present a regulatory hurdle, but an additional challenge in terms of the new company’s public image.

“Anytime you get into monopoly conditions, that’s not considered good at all for the farmer,” said Hansen.

Ultimately, the effect of the merger on Monsanto’s image may come down the name the company takes on in the aftermath of an approved deal. In comments Wednesday, Monsanto Chief Executive Hugh Grant said the name of the company was not discussed as part of the merger. “That’s really the $66 billion question,” said Keene, weighing whether Monsanto will keep its name.

On one hand, the company’s name has garnered notoriety in some circles that it may wish to shed.

“They’re keenly aware that that’s a huge liability in terms of limiting their business opportunities,” said Ricardo Salvador, the director of the food and environment program with the Union of Concerned Scientists.

But on the other hand, Monsanto could be compelled to keep its name, Keene said, because its name-brand crop science still holds “unique” value to a number of customers.

“From a marketing stand point, Roundup is highly valued in their marketplace,” Keene said.

“Within their lane, Monsanto has a great brand recognition if nothing else.”

Bryce Gray • 314-340-8307 @_BryceGray on Twitter bgray@post-dispatch.com

The drama ends: Bayer buys Monsanto Co. for $66 billion BAYER • FROM A1

Monsanto’s board of directors, Bayer’s board of management and Bayer’s supervisory board have unanimously approved the agreement. The deal is expected to close by the end of 2017, pending regulatory approvals and approval by Monsanto shareholders.

Like the losses of McDonnell Douglas, Trans World Airlines, Anheuser-Busch and Ralston Purina, the Monsanto deal eliminates yet another headquarters for a market leader that gave the St. Louis region recognition across the world.

Monsanto said Wednesday that it had 4,100 area employees, most of them at headquarters and offices in Creve Coeur and lab space in Chesterfield. That figure does not include hundreds of contractors, remote workers or temporary employees.

Executives emphasized that the combined company would retain a strong St. Louis presence; but Bayer, based in Leverkusen, Germany, has committed to finding $1.5 billion in “synergies” over the next three years, most of them in general and administrative expenses.

The seed and traits business and the combined company’s North American commercial headquarters will be based in the St. Louis area, and its global Crop Protection and overall Crop Science headquarters will be based in Monheim, Germany.

The combined company also will keep an important presence in Durham, N.C., where Bayer’s U.S. crop science headquarters is based, and its digital agriculture platform will be based in San Francisco, the home of Monsanto’s farm-data subsidiary Climate Corp.

“We believe that this combination with Bayer represents the most compelling value for our shareowners, with the most certainty through the all-cash consideration,” Monsanto Chairman and Chief Executive Hugh Grant said in a statement.

Grant said he thought the deal would ultimately be “a good thing” for St. Louis because Bayer had an incentive to invest in the region’s strong pool of plant science talent and engage with vibrant ag-tech startups.

CROP SCIENCE REVENUE SPLIT 2015 Fiscal year Monsanto

Bayer

By segment* Cotton S&T 4%

Corn S&T 40%

Ag productivity 32%

3% Other crops Fungicides 28%

Soybean S&T 15%

Vegetable seeds 5% Herbicides 27%

Insecticides Seeds Enviromental 15% 12% Science 8%

SeedGrowth 9%

By region 4% Canada 4% Mexico

U.S. 57%

Brazil Europe-Africa 11% 12%

1% Other

Asia-Pacific 5% Argentina 6% Latin America 29%

Europe 30%

North America 26%

A-Pac 15%

*By segment figures add up to 99 percent.

SOURCE: Bayer | Post-Dispatch

DEAL CREATES A DOMINANT COMPANY IN AGRICULTURE Pro forma sales In billions

Monsanto $14.1

Bayer $11.5 $25.6

ChemChina and Syngenta $16.4 DuPont and Dow $16.2 BASF Ag $6.4 SOURCE: Bayer | Post-Dispatch

The future of St. Louis in the larger organization was an important piece of the two companies’ discussions, he said.

“It doesn’t sound like it, but I’m a St. Louisan,” Grant said, joking about his thick Scottish accent. “And I’ve lived there for the last 20 years and raised my family there. … St. Louis becomes the global center for seeds and traits R&D, and St. Louis becomes the national hub for North America.”

Monsanto Chief Technology

Officer Robert Fraley called the deal “bittersweet.”

“I’m really proud of what Monsanto has accomplished in launching traits and getting into the digital ag space,” he said in a phone interview with the PostDispatch.

But ultimately, joining Bayer has the same logic to it that Monsanto’s unsuccessful bid for Syngenta last year did. The seed leader wants to catch up with rivals in crop chemicals now that its patent has expired on the blockbuster Roundup herbicide, which it pioneered as a pairing with corn and soy that it genetically modified to survive Roundup applications.

“Bayer has a world class crop chemical business,” Fraley said.

The deal “creates great synergies with seeds and traits and data sciences.”

Bayer, known for more than a century as the maker of aspirin, isn’t the first drug company to acquire Monsanto.

In 2000, Monsanto merged with pharmaceutical company Pharmacia. Less than three years later, it reemerged as a local company. As part of drugmaker Pfizer’s deal to buy Pharmacia, Monsanto was spun off as a

stand-alone agricultural chemical and biotech company, leaving its 100-year history in chemicals and drugs behind to focus solely on the genetically engineered seeds that transformed agriculture.

And this deal isn’t done yet.

Bayer’s offer includes a fee of $2 billion should the transaction fail to get regulatory clearance, a process the market appears to view as uncertain.

Monsanto’s shares closed up just 0.6 percent at $106.76 Wednesday, leaving them nearly 17 percent below Bayer’s offer.

Bayer’s shares in Frankfurt also rose 0.6 percent.

“They’re essentially reflecting a regulatory approval process that is going to be really difficult to get through,” Edward Jones analyst Matt Arnold said of the trading in Monsanto. “I like to listen to what the stock market tells you; and what the stock market is telling you is, it’s a flip of a coin.”

The deal follows a wave of consolidation in the agrichemical industry, partly touched off

by Monsanto’s failed bid last year to buy Swiss rival Syngenta. After rebuffing Monsanto’s overtures, Chinese state-owned company ChemChina announced a deal to buy Syngenta. Meanwhile, Dow and Dupont are in the midst of a tie-up.

Ultimately, the $128-per-share offer came in lower than what some analysts had predicted Monsanto could command based on its strong research and development pipeline and the math it used to value Syngenta. But with a struggling agriculture economy because of low commodity prices, Monsanto ended up selling near the bottom of the market.

Arnold suspects the deal was pushed over the finish line by shareholders unwilling to wait for some of the value in Monsanto’s longer-term research to blossom. Monsanto’s CEO Grant said as recently as April that it no longer saw large-scale mergers as a strategy and that it was better positioned than competitors to combine seed, chemical and data services into a comprehensive package for farmers.

“In our mind we thought Monsanto had a compelling case to ask for over $140” a share, Ar-

nold said. “The board had a fiduciary duty in an era of activist shareholders pushing them to do what’s best for shareholders, whether they’re short-term or not.”

The Monsanto name may go away as the seeds and traits business becomes just one division of a giant conglomerate that also makes pharmaceuticals and other health-care products.

When Monsanto courted Syngenta last year, it indicated that it was open to changing a corporate name that has gathered a fair amount of stigma because of opposition from groups that oppose Monsanto’s development of genetically modified crops.

Grant said the tie-up was focused on “innovation,” product research and the combined product line the two companies could offer to farmers.

“We haven’t discussed that (rebranding), but we have said in the past when we looked at previous transactions that that was something we would be flexible on,” Grant said in a call with reporters.

Bayer said it would raise the cash to pay for Monsanto by issuing debt and $19 billion in equity, including a mandatory convertible bond and a rights issue.

At a total deal value of close to $66 billion — based on 442 million Monsanto shares and the U.S. company’s net debt of $9.3 billion at the end of May — it will be the largest transaction ever involving a German buyer.

It would trump Daimler’s 1998 merger with Chrysler, which valued the U.S. carmaker at more than $40 billion.

Monsanto and Bayer were talking as early as March about ways to combine their businesses. Bayer went public with a $122-a-share takeover proposal in May, sweetened it to $125 in July and then increased it to $127.50 earlier this month.

Lisa Brown of the Post-Dispatch, Reuters and the Associated Press contributed to this report.

Jacob Barker • 314-340-8291 @jacobbarker on Twitter jbarker@post-dispatch.com

09.15.2016 • Thursday • M 1 ST. LOUIS POST-DISPATCH • A5 BAYER BUYS MONSANTO

FROM SWEETENERS TO SEEDS

Monsanto sale raises concern for jobs here

Over its 115-year history, Monsanto has continually reinvented itself through technology and business mergers, marketing products that have both transformed agriculture and fueled controversy. Here’s how the St. Louis-area company grew from modest beginnings into a global biotech giant.

JOBS • FROM A1

A T I M E L I N E OF MONSA N TO’S E VOLU T ION

1901 Monsanto is founded as an independent venture of John Queeny, an employee of Meyer Brothers Drug Co. Queeny set out to produce saccharin, an artificial sweetener, and named the company Monsanto after his wife, Olga Monsanto Queeny.

1910 Monsanto buys a lot owned by Diamond Match Co. for $75,000, shortly after Diamond’s nearby building burned to the ground.

1916 In January, Monsanto Chemical Works begins advertising in the St. Louis Post-Dispatch.

In December, Monsanto completes construction of a new employee services building. Situated on Lafayette Avenue, east of Second Street, the two-story building provides a lunch and recreation room, lockers and shower facilities for 300 workers at one time.

1901 • Monsanto Chemical Works began modestly in the dusty corner of a warehouse at 1812 South Second Street.

1917 Now calling itself Monsanto Chemical Works, the company makes a wide range of chemicals and drugs. For instance, Monsanto begins producing aspirin and continues to make its active ingredient — which it sold to producers of aspirin for retail sale — until late in the 20th century.

Monsanto buys 90 acres near East St. Louis to build a $1 million plant and employ 2,000 people in what is now Sauget.

1935 Monsanto begins its production of PCBs, chemicals used for insulation and cooling in electrical equipment. It eventually becomes the primary American producer of PCBs, accounting for an estimated 45 percent of the global supply.

MID-1940s Monsanto makes its initial foray into agriculture with Santobane, a pesticide that targets corn borers and other insects.

1947 • Dwight Henderson, a Monsanto glassblower, creates custom laboratory equipment for research scientists.

1955 The rise of oil-derived petrochemicals leads Monsanto to purchase Lion Oil Co., which makes ammonia and other products. This acquisition marks the start of a new phase of investment in chemical fertilizers, which become a main part of its business. The reliance on fertilizers ebbs by the 1980s as it gravitates toward other applications of agricultural science.

1965 Through 1969, Monsanto is one of nine contractors to produce the defoliating herbicide known as “Agent Orange,” used in the Vietnam War. Agent Orange’s chemical mixture included toxic substances such as dioxin and continues to be a health concern for veterans who were exposed to it.

1969 After beginning product development and testing in the mid1960s, Monsanto starts selling Lasso herbicide. The weed killer is a best-selling corn and soy herbicide in the U.S. for more than two decades.

1970 Only a year after Lasso’s release, Monsanto develops Roundup, a glyphosate-based herbicide. The herbicide would evolve into one of the company’s marquee products — especially once aided by innovations described below — and remains widely used today.

1949 • A little one-room factory developed into an industrial giant of the chemical industry; an aerial view of the John F. Queeny organic chemicals plant of Monsanto at 1700 South Second Street.

1955 Monsanto technician Bill Spring treats a plant that will be used in testing the power of an insecticide.

1977 Monsanto halts production of PCBs after studies expose the adverse environmental impacts of the non-biodegradable chemical. A federal ban on PCB production is issued in 1979.

The company has retained many cleanup liabilities related to PCBs. 1983 After several years active in biotechnology, Monsanto becomes the first company to alter plant cells in a laboratory and to grow plants from genetically modified cells. Field tests of genetically modified plants would begin later in the decade.

1985 For $2.7 billion, Monsanto purchases G.D. Searle & Co., a producer of artificial sweeteners and prescription drugs. At the time, Monsanto officials said the acquisition aligned with the company’s goal of “moving away from the commodity chemical past and making a quantum leap into the future of pharmaceuticals, health care and biotechnology-oriented products.”

1994 After undergoing years of regulatory review, Monsanto markets its first biotech product — a hormone known as BST, to be injected into dairy cows to boost milk production.

1996 The company begins to orient its portfolio around biotech seeds, as Roundup Ready soybeans are introduced, providing farmers with seeds genetically engineered to be resistant to Roundup and other glyphosate herbicides. Roundupresistant technology enables farmers to apply herbicide without worrying about damaging their crops, but also leads to concerns about “superweeds” that develop glyphosate resistance of their own.

1997 Roundup Ready cotton and canola are introduced.

Monsanto spins off its legacy chemical business into an independent company called Solutia, remaking itself as a “life sciences” business. Monsanto retains its top moneymaking product, Roundup, and refines its focus to artificial sweeteners, drugs, herbicides, pesticides and seeds.

EXECUTIVES VISIT STENGER

1968 • Monsanto’s Creve Coeur campus.

1998 Roundup Ready corn is introduced.

2000 Monsanto merges with Pharmacia Corp., a pharmaceutical company that in 2003 is swallowed up by Pfizer Inc. Pfizer splits off Monsanto as a standalone agricultural company and sells its shares in a public offering.

2015 The company continues to roll out seeds engineered with new herbicide resistance, releasing dicamba-resistant cotton.

Dicamba-resistant soybeans would be introduced a year later.

For each product, however, the corresponding dicamba-based herbicide still has yet to be approved.

Monsanto is rejected after making a $45 billion offer to buy Syngenta, a Swiss competitor that sells seeds and agricultural chemicals. Syngenta is sold in February 2016 to a Chinese company, ChemChina, for $43 billion.

2016 After months of back-and-forth talks, Monsanto’s board agrees to sell the company for $66 billion to Bayer of Germany.

Bryce Gray • St. Louis Post-Dispatch

business would keep “an important presence” at its current U.S. headquarters in Research Triangle Park in Durham, N.C. But some of those functions would shift to the St. Louis region, said Liam Condon, who heads Bayer’s crop science division.

“The commercial part of the business for Bayer, which is currently out of Research Triangle Park, that would move to St. Louis,” Condon told the Post-Dispatch.

Details on specific job impacts probably depend on what the combined company ultimately looks like. Significant antitrust hurdles remain, and a combined company will probably have to sell overlapping businesses. In a conference call with reporters Wednesday, Bayer Chief Executive Werner Baumann declined to name which pieces he viewed as overlapping and said it’s “way to early to talk about individual sites and impacts on individual sites.”

Monsanto said Wednesday that it has 4,100 employees in the St. Louis region, not including several hundred remote workers, temporary employees or contractors.

Bayer has promised to find $1.5 billion in “synergies” over the next three years, a term that often means cost cuts in overlapping areas.

“Anywhere there’s duplication, there’s risk of cuts happening,” said Edward Jones analyst Matt Arnold, who covers Monsanto. “That’s an unfortunate reality of mergers.”

The biotech giant’s employees are primarily based at its Creve Coeur headquarters campus and its Chesterfield Village Research Center, where it’s spending $400 million to expand facilities.

“The area is going to lose administrative jobs and jobs at the top,” said Erik Gordon, an assistant professor at the University of Michigan’s Ross School of Business.

“There will be fewer finance, legal, and accounting people,” he added. “That is the price for Monsanto failing to win Syngenta.” Swiss farm-chemical maker Syngenta rebuffed Monsanto’s takeover offers in 2014 and 2015.

In an interview with the Post-Dispatch, Monsanto Chief Technology Officer Robert Fraley said the Chesterfield expansion would proceed.

“From a St. Louis perspective, from the very first discussions … consideration of St. Louis was right at the forefront,” Fraley said.

When Monsanto announced its Chesterfield expansion in 2013, it said it had plans to add 675 jobs to the roughly 4,000 it employed in the region over several years, many of them plant scientists and other researchers. Fraley said some of the new Chesterfield greenhouses will be complete next month and a new building is slated to be finished next year.

“We have plans to fully fill those greenhouses,” Fraley said.

Still, corporate mergers often mean reducing overlap in top executive functions, which for Monsanto are based in Creve Coeur. The downturn in agriculture has already hit the company.

Monsanto announced a number of job cuts over the last year that were intended to pare its global workforce by 16 percent. Area jobs have decreased since March 2015, when the company employed about 4,300 people at its two main campuses in the St. Louis area, according to documents submitted to Missouri for tax incentives.

Over time, it may make sense to consolidate research operations within the larger company, said Thad Simons, managing partner at local ag-tech accelerator Yield Lab. And any cost cutting may fall more heavily on the U.S. “German companies have labor representation on their supervisory board, so they have greater challenges in reducing staff in Germany,” Simons noted.

Even research and development, which is “the lifeblood of long term success in this business,” can be cut without sacrificing productivity if there’s overlap, Edward Jones’ Arnold said. However, Monsanto’s industryleading seed and trait research operations are probably relatively safe from Bayer cuts.

“We can take solace in the fact that, in this particular case, they’re buying the people and knowledge base,” Arnold said.

Representatives from Monsanto called Chesterfield Mayor Bob Nations on Wednesday and invited him to Monsanto’s headquarters Thursday to meet with Baumann and Monsanto Chief Executive Hugh Grant.

“We’re anxious to get more information,” Nations told the Post-Dispatch. “To the extent that we’re aware, the merger with Bayer would not have any significant impact on expansion plans in Chesterfield. … We are interested and concerned. We can only hope that their presence and quality jobs will remain here and grow beyond that.”

Creve Coeur Mayor Barry Glantz, who also was invited to the Thursday lunch with executives, said the gesture was a good sign. “That’s encouraging to me that they’d reach out to the community to give an indication about what their intentions are, and I think that’s a positive first step,” he said.

Still, Glantz said he was mindful that a change in ownership at Monsanto, a major employer and property owner, could have big consequences for Creve Coeur.

“The uncertainty surrounding the transaction is certainly disconcerting,” Glantz said. “We know what we have now and the uncertainty of what could happen in the future is always a question mark.”

1968 • Jay Henis examines a network of vacuum apparatus that is used to purify and distill substances that he runs through Monsanto’s ion cyclotron resonance mass spectrometer.

St. Louis County Executive Steve Stenger said Bayer and Monsanto executives visited his office about three months ago and assured him of Monsanto’s long-term commitment to the region.

“I can’t tell you exactly the number of jobs they’ll have, but they indicated to me that they plan to continue to have a strong presence in St. Louis County,” Stenger said. “I’m cautiously optimistic but there are so many things yet to be seen. It’s extremely important because they’re a key player in our agribusiness.”

The scope of Bayer’s $66 billion acquisition of Monsanto invites comparisons to another corporate acquisition in the not-too-distant past: Anheuser-Busch employed more than 6,000 people in the St. Louis area when it was acquired by Belgium-based InBev for $52 billion in 2008.

After the acquisition, A-B InBev pared its area workforce to 4,000 by 2011, the last year the company provided local figures. In 2015, A-B moved its sales and marketing operations for the U.S. and Canada to New York, affecting several hundred jobs. A spokeswoman for the brewer declined to say how many people it currently employs locally, saying the company does not break out local workforce figures.

A-B InBev still employs thousands at its brewery south of downtown and elsewhere in the region. When outlining plans for its proposed acquisition of rival SABMiller, A-B InBev recently said St. Louis will continue to serve as the company’s North America zone headquarters. Also this year, A-B InBev added 70 jobs when it invested $150 million to expand its aluminum bottle plant in Arnold.

Jacob Barker of the Post-Dispatch contributed to this report.

ST. LOUIS POST-DISPATCH FILE PHOTOS

Lisa Brown • 314-340-8127 @lisabrownstl on Twitter lbrown@post-dispatch.com

A6 • ST. LOUIS POST-DISPATCH

BAYER BUYS MONSANTO

M 1 • Thursday • 09.15.2016

CEO could reap millions from sale Grant’s golden parachute, stock gains could total $48 million if buyout goes through

BY JIM GALLAGHER St. Louis Post-Dispatch

Monsanto CEO Hugh Grant, a very rich man, could be about $77 million richer if he manages to sell Monsanto to Bayer AG for $66 billion.

He holds a golden parachute contract that would net him about $29 million should he leave after the takeover, according to

a Post-Dispatch estimate.

Neither Grant nor Bayer has said whether he would have a role in the posttakeover company.

The $128-a-share buyout price is a 43 percent premium over Monsanto’s $89 per share value in midMarch, before Bayer’s interest became public. That premium would lift the value of Grant’s own Monsanto stock, outside the

golden parachute deal, by about $48 million.

His total gain could hit the $77 million range.

The golden parachute calculations are derived from estimates of potential severance payouts in Monsanto’s proxy issued last December, adjusted for the buyout share price.

The proxy said that Grant held, directly or indirectly, 1.5 million shares and exer-

ciseable stock options as of last fall.

The estimate doesn’t account for shares he may have bought or sold or been granted since then.

Grant might suffer some losses, too, if he leaves the company. He gets to take personal flights on the corporate jet, a perquisite valued at $243,000 last year.

He would also leave behind compensation that totaled

$11.9 million last year.

Buyout deals often contain special financial arrangements for top executives of the acquired company. Those provisions, if any, have not yet been revealed.

The buyout would be a bonanza for other top Monsanto bosses. Chief Financial Officer Pierre C. Courduroux’s golden parachute would be worth $6.5

million should he leave the firm after the deal closes.

Brett Begemann, chief operating officer, could walk away with $10.3 million.

Both men also own large amounts of Monsanto stock.

Jim Gallagher • 314-340-8390 jgallagher@post-dispatch.com @JimGallagher14 on Twitter

Charities hope Monsanto will keep giving

BY SAMANTHA LISS St. Louis Post-Dispatch

For decades, Monsanto and its charitable fund have funneled millions of dollars into communities and education programs in St. Louis and around the world.

The company’s name adorns the buildings of many prominent local institutions such as the Missouri Botanical Garden’s research facility, the St. Louis Zoo’s Insectarium and Education Gallery, and various facilities at the area’s universities.

Most recently, Monsanto provided $2 million to construct the St. Louis Science Center’s GROW exhibit, which opened in June as its largest permanent exhibit since 1991. It is a handson experience that shows the process of how food is grown.

It’s unclear, however, if the company’s level of financial support will change if the $66 billion sale to a German firm, Bayer AG, is completed. On Wednesday, after months of back and forth, Bayer AG officially announced it would buy Creve Coeurbased Monsanto, saying that both boards had agreed to the deal, which still requires shareholder and regulatory approvals.

The St. Louis area will be home to the combined company’s Seed and Traits business and its North American commercial headquarters. Bayer said it looked forward to being an important part of the overall St. Louis community.

“Bayer pledges to maintain strong community and philanthropic commitments in the communities where the combined company will operate, as well as look for new opportunities to help support innovation and growth,” according to a statement.

In addition to significant corporate giving, Monsanto uses its Monsanto Fund to provide support to both farming communities and areas where employees live and work.

Most notably in the area, the Monsanto Fund provided in 1998 the initial funding to construct the Donald Danforth Plant Science Center, while the company donated the more than 40 acres in Creve Coeur near its headquarters for the facility.

The Donald Danforth Plant Science Center continues to receive support from the Monsanto Fund for its research projects.

“Yes, Monsanto has been a terrific supporter over the

POST-DISPATCH

In 2002, Clare Nobs, 3, and her father, Scott Nobs, of Shrewsbury, come face to face with an Atlas moth inside the butterfly dome at the St. Louis Zoo’s Monsanto Insectariume.

years, but we receive support from a whole host of companies including Monsanto’s competitors,” said Sam Fiorello, chief operating officer at the center.

“I’m optimistic that we won’t see any significant negative impacts of this,” he said of the region.

But Eileen Heisman, president and chief executive of the National Philanthropic Trust, said the culture surrounding giving was very different around the world.

“The traditions of philanthropy of Europe and Asia are very different than the United States,” she said.

The Monsanto Fund relies solely on the company to provide the annual budget for its grantmaking.

“We are 100 percent fully funded by the Monsanto company,” Michelle Insco, an executive with the fund, told the PostDispatch in the weeks before the announcement of the Bayer deal.

Many local organizations that rely on support from the fund say it’s vital to their existence.

In 2014, the Monsanto Fund doled out a total of $19.4 million in grants to hundreds of organizations.

In the St. Louis area, the support funds everything from innovative science education to legal services for school children.

The Monsanto Fund’s annual filings with the Internal Revenue Service are a testament to the organization’s long reach. For example, its most recent filing is nearly 200 pages, accounting for every dollar donated in 2014.

At the top of the list of organizations that received the most grant funds in 2014 in the area are United

Way, Donald Danforth Plant Science Center, St. Louis Symphony and Teach for America.

One of the largest recipients in the region was a Washington Universityled program that aims to improve science curriculum for the area’s school children.

The program, called MySci, received about $920,000 in 2014 to create

innovative, hands-on lesson plans for the region’s teachers. During the 20142015 school year, the program provided more than 2,000 instructional materials to teach 18,000 students.

The program would “absolutely not” be possible without the annual funding from Monsanto, said Vicki May, executive director of Washington Univer-

sity’s Institute for School Partnership.

Officials with the Opera Theatre of St. Louis feel the same.

The group has received financial support from the Monsanto Fund since 1990. In 2014, its annual support totaled $90,000 to provide college-level vocal lessons to high school students. The highlight is that it connects children from different areas of the region who would probably never connect otherwise, said Allison Felter, director of education for the theater. “They are among the best corporate angels we’ve ever had,” she said.

The fund also provides funding to Legal Services of Eastern Missouri to help parents advocate for their children who may have special needs or require more resources from their public school system. The program helps parents eliminate barriers to their children’s education by providing legal representation to parents.

“Because you’re bringing an attorney with you the parents feel as if they’re getting more attention to the issues that are presented with their kids,” said Dan Underwood, an

attorney with Legal Services.

But it’s unclear what would become of the fund after the acquisition by Bayer, a deal that is expected to close by the end of 2017.

After Anheuser-Busch was bought in 2008 by Belgian beer-maker InBev, charitable giving by St. Louis’ beloved brewer dried up for some local organizations.

Matt Arnold, an analyst who covers Monsanto for Edward Jones, said sustaining charitable giving was “probably not” a key factor in the merger negotiations.

“One would imagine that that would be a relatively low negotiation point,” Arnold previously told the Post-Dispatch.

Insco previously said she had not been told what would happen to the fund if the company was acquired.

“We have had such strong roots in St. Louis for such a long time,” Insco said. “I think those strong roots are here to stay, and that’s important.”

Samantha Liss • 314-340-8017 @samanthann on Twitter sliss@post-dispatch.com

The Area’s Largest Fall Home Event!

September 23-25, 2016 St. Charles Convention Center

Home P roject List

ü ü ü ü ü SHOW HOURS Fri-Sat 11am-8pm Sun 11am-5pm

NEW DIRECTIONS Visit website for new routes to Convention Center.

Produced by

Repla

ce Ro of & S iding Kitch en Re model New F looring Bath Updat e New W indow s/D oors

STLHomeShow.com

u Dr. Lori is BACK! See Dr. Lori’s Antiques Appraisal Comedy Show. Bring one item for a free appraisal. u Visit the Party Flavors Sampling Event u Walter Knoll Floral Seminars u Family Fun - featuring kids pumpkin painting, crafts and games u Food Drive - donate non-perishable food items to the St. Louis Area Foodbank

REGISTER TO WIN a $750 Belgard Fire Pit! Courtesy of Lawn & Landscape Solutions

FREE Admission & FREE Parking