Shares in controversial seed giant Monsanto are growing after a German rival confirmed takeover interest
Shares in US seed company Monsanto grew more than seven per cent in after-hours trading after German rival Bayer confirmed it is seeking to take over the firm.
The share price of Bayer, meanwhile, fell 7.5 per cent to €89.15 after it confirmed its interest.
Bayer, the German drugs and chemicals maker, said in a statement on Thursday morning that its executives had met with counterparts from Monsanto to privately discuss a negotiated acquisition.
Read more: Seed company's shares grow after news of $43bn takeover interest
The company said: "The proposed combination would reinforce Bayer as a global innovation-driven life science company with leadership positions in its core segments, and would create a leading integrated agriculture business."
Monsanto, whose shares were up 7.5 per cent to $97.15 on Thursday, confirmed it had received "an unsolicited, non-binding proposal from Bayer AG for a potential acquisition of Monsanto, subject to due diligence, regulatory approvals and other conditions".
The company said: "The board of directors of Monsanto is reviewing the proposal, in consultation with its financial and legal advisors. Monsanto will have no further comment until its board of directors has completed its review. There is no assurance that any transaction will be entered into or consummated, or on what terms."
Read more: Monsanto gives up £30bn chase
It first emerged last week that Bayer was considering a move for Monsanto, which is valued at around $42bn (£28.7bn).
This time last year, Monsanto was pursuing a similar sized takeover itself. The New York-listed group gave up on its $46bn pursuit of Syngenta last August after its Swiss rival rejected a bid.
This was the third approach led by Monsanto boss Hugh Grant, after previous attempts in 2011 and 2012.