Fair trade regulator CCI has approved the German giant Bayer's proposed USD 66 billion acquisition of US-based biotech firm Monsanto, subject to certain modifications to the long-pending deal.
The approval to the deal, announced in September 2016, assumes significance in the wake of Monsanto facing opposition from various quarters within India over promotion of genetically modified crops, as also over royalty and patent issues.
The clearance from the Competition Commission of India (CCI) is one of the several regulatory approvals required by Bayer in various countries to close the deal.
Announcing its approval today, the CCI tweeted that it has cleared "acquisition of Monsanto by Bayer AG, subject to compliance of certain modifications".
Mergers and acquisitions beyond a certain threshold require approval of the CCI.
India is one of the 30 countries whose approval is needed for the merger of worldwide operations of the two companies. The major approvals still required are from the US Department of Justice as also regulators in Canada and Mexico.
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After getting the CCI nod, Bayer said in a statement that the CCI has conditionally approved its proposed acquisition of Monsanto.
"Obtaining clearance from the CCI is another milestone towards the global acquisition of Monsanto. The combination brings together two different, but highly complementary businesses," Bayer said.
The acquisition of Monsanto will create a global leader in agriculture with a broad portfolio, providing superior product offerings and tailor-made solutions to farmers across all crops, in all geographies, the German chemical and pharma firm said.
In January, CCI had launched a public consultation process to determine whether the merger between the global giants, to create the world's largest seeds and pesticide firm, will have any adverse impact on competition in India.
In India, both entities have presence in production and sale of vegetable seeds, cotton seeds as well as in production and sale of non-selective herbicides, according to that public notice.
Both the companies have presence in India, with the US firm selling genetically modified (GM) cotton seeds in the country for more than a decade.
Bayer group is present in India since 1896 and it has two divisions -- crop science and pharmaceuticals. The group has one listed entity in India -- Bayer CropScience Ltd that posted a revenue from operation of nearly Rs 3,000 crore last fiscal.
Bayer India had an annual revenue of 600 million euros (about Rs 4,700 crore) in 2017, Richard van der Merwe, the senior Bayer representative, South Asia, had said in January this year.
Monsanto would add seed business to Bayer's already significant crop science and pharmaceutical business in India.