After years of criticism, Monsanto might be going away—the name, that is.
The U.S. crop giant is now contemplating a name change, as well as considering moving its headquarters to the U.K., to complete a hostile takeover with its Swiss rival.
In a letter dated April 18 released by Basel-based Syngenta and published by the St. Louis Post Dispatch's Tim Barker, the Missouri-based company outlines the measures it would now be willing to take in response to Syngenta's multiple merger offers. Here's the text in question:
…We propose to combine the two companies under a newly formed parent company incorporated in the United Kingdom (‘NewCo’). A parent company, domiciled in the U.K., would demonstrate that our merger will create a global enterprise focused on future growth across all geographies, as well as provide additional synergies. We would also propose a new name for the combined company to reflect its unique global nature.
Monsanto is more than 114-years-old, and has held the name since its founding by a struggling pharmaceutical entrepreneur from Chicago. But in the past two decades it has received a blistering amount of criticism as it became the face of GMO foods and pesticides. The company has appeared largely immune to the attacks until recently, when in 2013 it shook up its public relations team and (along with other chemical companies) created a website, GMO Answers, designed to deal with the various criticisms it has received.
The company did not immediately respond to a request for comment.
It's also worth discussing the other part of the deal mentioned above: In recent years, a host of companies have relocated their official headquarters to the U.K. to take advantage of lower overseas taxes in a move known as a tax inversion.
Monsanto told Barker that tax inversion was not the reason for their proposal. “As we’ve previously stated, this is not a tax-driven deal,” Sara Miller, a Monsanto spokeswoman, the Post Dispatch's Barker. “If people view our Syngenta proposal as tax-driven, it misses the vision of what we intend to unlock. This is about creating a new company focused on increased innovation and expanded global reach to support farmers around the world.”
Yet the Financial Times is reporting it as a tax-inversion-driven bid.
"The Swiss company’s shareholders would hold about 30 percent of the combined entity—a threshold that satisfies a key requirement for a tax inversion," the paper wrote. "Under its current structure, the takeover would be the largest attempted tax inversion deal since the US Treasury cracked down on the practice last September."
Rob covers business, economics and the environment for Fusion. He previously worked at Business Insider. He grew up in Chicago.