China conditionally approves Bayer's acquisition of Monsanto

FILE PHOTO: The logo of Bayer AG is pictured at the Bayer Healthcare subgroup production plant in Wuppertal, Germany February 24, 2014. REUTERS/Ina Fassbender/File Photo

BEIJING (Reuters) - Bayer's BAYGn.DE on Tuesday secured conditional approval from China's commerce ministry for its planned acquisition of the world No. 1 seed company Monsanto MON.N, chalking up a victory in the onerous struggle to win over watchdogs across the globe.

The ministry also ordered the German drug and crop chemicals maker to spin off some businesses globally, including vegetable seeds, corn, soybean, cotton, and herbicide, according to a statement posted on the ministry’s website.

Bayer has already pledged to sell certain seed and herbicide assets for 5.9 billion euros ($7.27 billion) to BASF BASFn.DE to address EU regulatory concerns and has separately offered to sell its vegetable seeds business to BASF.

“These divestments are covered by our agreement and the ongoing negotiations with BASF as previously communicated,” Bayer said in a statement.

In addition, Bayer committed to grant “fair, reasonable and non-discriminatory access” to the merged entity’s digital agriculture offerings in China to Chinese developers of farm management software.

Bayer has secured the go-ahead from Brazilian regulators, while people familiar with the matter told Reuters two weeks ago that Bayer was in the frame to win conditional antitrust approval from the European Union for the $62.5 billion deal.

Bayer said at the time that the U.S. review was not as far advanced as EU’s, but it was confident it would make progress there over the next few weeks.

In Russia, however, Bayer has taken the regulator to court to “safeguard its rights” in the review procedure.

($1 = 0.8114 euros)

Reporting by Beijing Monitoring Desk, Patricia Weiss and Ludwig Burger; Editing by Shri Navaratnam and Pritha Sarkar