October 14, 1998

Life Industry Giants Devour Seed/Biotech Interests

Seed industry rankings have a shorter shelf life than tomatoes. As RAFI predicted, the frenetic pace of seed industry mergers has made our list of major seed companies and their subsidiaries out of date in a matter of weeks (see the July/August RAFI Communique, Seed Industry Consolidation).

Since August 31st, three life industry giants, AgrEvo, Dow and Bayer have announced strategic acquisitions and alliances in seeds and biotech:

--> Cargill Seeds has disappeared from the ranks of seed industry giants. Cargill (US), the worldÌs largest private company, sold its international seed business to Monsanto for $1.4 billion in May. On September 28, AgrEvo (Germany) announced that it would acquire Cargill Hybrid Seeds North America for $650 million. AgrEvo is jointly owned by German pharmaceutical firms, Hoechst and Schering. The acquisition strengthens AgrEvoÌs position in the US maize market and secures the company's access to elite germplasm. AgrEvo is the world's 5th ranking agrochemical corporation, with 1997 sales of $2.4 billion.

--> Dow AgroSciences, a division of Dow Chemical (US), announced that it would acquire all remaining outstanding shares of Mycogen (US) on August 31st, thus gaining full control of Mycogen Seeds, with 1997 seed revenues of $162 million. Dow's first move after solidifying control was to loan Mycogen cash so that the company could swallow up two Brazilian corn and sorghum seed companies, Hibridos Colorado and FT Biogenetica de Milho on September 14th. Dow also announced on 7 September that it would establish a new plant biotech company, Advanced AgriTraits, and also took a 10% stake in US-based Illinois Foundation Seeds Inc. Dow Chemical is the fifth largest chemical company in the world, with annual sales of $20 billion.

--> In a series of moves to bolster its life sciences operations, Bayer (Germany) announced on 17 September that it would acquire the diagnostics division of US-based Chiron Corporation (the second largest biotech firm) for $1.1 billion. Bayer also announced a 50% acquisition of the seed treatment business of Gustafson (US). On 24 September Bayer announced it would acquire a 14% stake in US-based Millennium Pharmaceuticals, in a 5-year collaboration worth $465 million. Millennium Pharmaceuticals is a leader in genomic technology (molecular research on the function of genes). Bayer called its alliance with Millennium the largest to date in the field of drugs research."

Please consider supporting ETC's unique research and advocacy with a tax-deductible donation. Donate here