Bayer and SBM Développement announced their plans to sell Bayer’s consumer garden product unit, which includes Bayer Garden and Bayer Advanced, to SBM. These units sell garden products to North America and Europe. This will mark SBM’s entre into North America.
The transition is scheduled to take place in October of this year.
Big changes are happening at Bayer. This sale takes place just as Bloomberg reports that Bayer was considering a mega-merger with its main rival, Monsanto. The Bloomberg report was followed by Bayer confirming its intent to acquire Monsanto on May 23. If that merger went through, the new company would be the largest supplier of seeds and farm chemicals.
Greenhouse Grower RETAILING reached out to both Bayer and SBM to learn more about the sale. Below, Bayer’s Casey Allen responds to our questions. Watch this space for SBM’s responses, which we’ll post once we have them.
Q: How will the supply chain be affected between now and spring 2017? Will current distributors maintain their contracts? If garden retailers place orders at the summer tradeshows, what type of hiccups on delivery and payments might occur?
Bayer’s Casey Allen: From now until the closing, the product offerings of Bayer Advanced will not change; Bayer will continue to provide high-quality, innovative portfolios of home and garden products for consumers. Upon the closing, SBM will determine the future of the product offerings. In order to support business continuity, Bayer will supply products to SBM for a transitional period after the closing. In addition, SBM plans to use both third party sites as well as its own to address business needs in the future.
Q: How does this sale play into the Monsanto bid? How does this prepare Bayer for any merger of this scale?
Bayer: Bayer regularly assesses its portfolio and the decision to investigate strategic options for the Bayer Garden and Bayer Advanced businesses was the result of such a strategic review, which was initiated back in March 2015. The offer to acquire Monsanto is an all-cash offer comprised of both debt and equity, and is not connected to this sale.
From the press release:
“For SBM, the acquisition of the Bayer Garden and Bayer Advanced businesses represents a major milestone in our journey toward global leadership in the consumer home and garden industry,” says Jean-Paul Simmler, chairman of SBM. “We are committed to growing these businesses over the long-term by providing customers in Europe and the U.S. with an innovative range of solutions that leverages the strengths of both SBM and Bayer.”
“In SBM, we’ve found a strategic acquirer that can provide the Bayer Garden and Bayer Advanced businesses and people with a long term vision and perspective to reach their full potential,” remarked Dr. Jacqueline Applegate, Head of Environmental Science and Member of the Crop Science Executive Committee. “At the same time, divesting the Consumer business will enable Environmental Science to become even more growth-oriented and strengthen our market leadership position with a single-minded focus on the unique needs of our professional customers.”
And here’s how the same press release describes SBM Développement:
SBM Développement is an independent and family-owned France-based group of companies that develops, formulates, and distributes ranges of crop solutions for professionals and consumers. Their activity relies on three pillars: R&D, Industry, comprised of two formulation and packaging factories in France, and Distribution, with Novajardin, a unit dedicated to Consumers and offering the brands Solabiol, Capiscol, Caussade and ANTI, and CMPA, a unit dedicated to crop professionals. A leader in the French home and garden market, SBM has expertise in biologics, fertilizers, and soils. With about 300 employees in Europe, the company has grown organically and through a series of successful acquisitions.