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Megamerger:Monsanto-SyngentaOpposition Group 1Anthony MatoloJonathan ThomasJordann PellerinKimberley BaileyOlivia FriedliSteven Rohrbacher
Definition of MegamergerA merger, also called consolidation, is a process by which two or more companies join while all property is transferred to one remaining association."Megamerger" is a term used to reference when two or more enterprises are joining together whom each own a large share of the market. These prospective deals often involve the exchange of billions of dollars. There are regulations in place to dampen potential megamergers if they are viewed to be a monopoly. "Section 7 of the Clayton Act prohibits mergers and acquisitions when the effect may be substantially to lessen competition or to tend to create a monopoly."(FTC Mergers, 2017)
Types of MergersHorizontal MergerVertical MergerConglomerate MergerGeographic Extension MergerProduct Extension Merger
Monsanto-Syngenta Merger●Monsanto is the leading agricultural chemical company in the world, with two product segments - Seeds and Genomics and Agricultural Productivity.○Had reported total sales of $15 billion in the year 2015.○Has a presence in more than 150 countries.●Syngenta is also one of the leading agricultural companies in the world, with products including crop protection, seeds, and lawn and garden products.○Had reported total sales of $15 billion in the year 2014.○Has presence in 90 countries.(Ariel, 2015)
Monsanto-Syngenta Merger (cont.)●In August of 2015, Monsanto offered $46 billion as a takeover bid to acquire Syngenta.●This agriculture mega-merger would threaten to undermine the basis of our food supply and jeopardize efforts to build climate resilience. ●A short-term financial boost for investors is hardly justification for allowing this megamergers which threatens farmer livelihoods, the environment, long-term food security, and consumer choice. Therefore our stance is to oppose this merger between Monsanto and Syngenta.(Ariel, 2015)
Legal Criteria of a MegamergerSherman Antitrust Act of 1980The Sherman Act makes it a crime to monopolize any part of interstate commerce. Section 1 of the Sherman Act forbids price-fixing and prohibits dishonest practices like cartel operations that unreasonably restrain trade.