German conglomerate Bayer AG’s agreement to sell crop science businesses for $7 billion to BASF includes its R&D employees and campus in the Research Triangle Park.
Both of the German agricultural giants have major facilities in North Carolina, contributing to North Carolina’s reputation as a global capital of agricultural biotechnology.
The purchase by BASF includes an agreement that the buyer will retain, for at least three years, Bayer’s RTP campus and the approximately 300 employees working in the company’s seeds business.
The sale is subject to successful closing of Bayer’s previously announced $57 billion acquisition of U.S. agricultural heavyweight Monsanto. Bayer has said it hopes to close that deal in early 2018.
“The BASF commitment is exciting news for the North Carolina agriculture innovation community,” said Scott Johnson, vice president of the North Carolina Biotechnology Center’s Agriculture Initiative. “Extending their capabilities with new assets from Bayer will allow BASF to continue to provide farmers throughout the world needed products developed here in North Carolina.”
Werner Baumann, chairman of the Bayer Board of Management, said in a news release announcing the sale that “we are pleased that, in BASF, we have found a strong buyer for our businesses that will continue to serve the needs of growers and offer our employees long-term prospects.”
Bayer has numerous facilities across North Carolina, including what has been its North American and global seeds headquarters on its 124-acre RTP campus. This sale will put that line of research under the BASF banner, and Bayer plans to consolidate around Monsanto’s St. Louis headquarters, where it expects to drop the Monsanto name.
“The decision to consolidate the Bayer headquarters to St Louis is an understandable business decision based on potential synergies,” noted NCBiotech’s Johnson. “We know that the innovation roots that began with Union Carbide breaking ground in 1980 at the Alexander Drive location in RTP will continue to connect Bayer to our community through various research and investment activities which are ongoing.”
Change is a constant over decades
Friday’s announced purchase is the latest in a long line of changes that continues to reinvent the life sciences across the globe.
Union Carbide built the original Bayer RTP facility in 1980 and took occupancy in 1981, relocating employees from Jacksonville, Florida and Salinas, California into what became the headquarters for its Agricultural Products division. Rhone-Poulenc Agricultural Division purchased Union Carbide Agricultural Products in 1987 and combined its North American headquarters into the RTP site from Princeton, New Jersey.
Rhone Poulenc merged with AgrEvo (Horst Corporation) in 2000 to form Aventis CropScience, which was subsequently purchased by Bayer in 2002. Bayer then relocated its operations, including its marketing and executive staff in Kansas City to what is today the Bayer CropScience North America and global Seeds headquarters in RTP.
BASF established its base on Davis Drive in RTP 31 years ago, with the September 1986 opening of a crop protection facility for developing and producing insecticides, fungicides and herbicides. Since then it has grown the site into the North American headquarters for its crop protection division.
It also established a plant science group on the RTP campus in 1998, which is working on genetic traits that can improve the yields of corn, wheat, soybeans, canola, rice and cotton. RTP has subsequently been designated the company’s global plant science headquarters.
In 2013 the company added a $33 million expansion to its RTP campus, making it the largest agricultural employer in RTP, with some 275 plant science employees and 675 in crop protection.
“The agreement between Bayer and BASF to maintain plant sciences infrastructure and talent is recognition of the vibrant agtech ecosystem in North Carolina,” said Johnson.
The sale is to include Bayer’s global glufosinate-ammonium business and the related LibertyLink technology for herbicide tolerance, essentially all of the company’s field crop seeds businesses, as well as respective research and development capabilities. The seeds businesses being divested include the global cotton seed business (excluding India and South Africa), the North American and European canola seed businesses and the soybean seed business.
A world-class investment
The transaction includes the transfer of relevant intellectual property and facilities, as well as more than 1,800 employees primarily in the United States, Germany, Brazil, Canada and Belgium.
“BASF is investing in a world-class facility with world-class talent able to continue their innovation focus on providing solutions to the grand challenges we have in agriculture,” noted the Biotech Center’s Johnson.
“With this acquisition, we are seizing the opportunity to purchase highly attractive assets in key row crops and markets,” said Kurt Bock, Ph.D., chairman of the BASF Board of Executive Directors. “We look forward to growing these innovative and profitable businesses and to welcoming the experienced and dedicated team in crop protection, seeds and traits. These businesses are an excellent match for BASF Group’s portfolio.”
