NO GERMAN firm has paid a higher price for shopping abroad than Daimler-Benz with its disastrous $43 billion merger with America’s Chrysler. When they did their deal in 1998, the carmakers claimed it was a smart manoeuvre in the face of industry consolidation. In fact, after culture clashes and much wasted effort, it fell apart within a decade. Eighteen years on, the record will be broken if Bayer, a drugs and chemicals giant best known for its pharmaceutical products such as aspirin, succeeds in its bid for Monsanto, the world’s biggest seed producer. Whether the outcome would be any better is another question.

Bayer first made an unsolicited bid for the American firm in May. A deal now looks close. Monsanto has spent the summer playing hard to get; this week it succeeded in getting Bayer to raise its offer again, to a whopping $65 billion (including debt). The German firm is responding to a wave of consolidation in the global chemicals and seeds industry. Earlier in the year ChemChina, a state-owned Chinese firm, agreed to pay $43 billion for Syngenta, a big Swiss firm that sells chemicals to farmers. Buying Monsanto would give Bayer control of the world’s biggest seller...Continue reading