Back to top

Analyst Blog

Bayer AG’s (BAYRY - Analyst Report) Bayer CropScience recently signed an agreement to acquire Prophyta GmbH which develops, produces and markets biological products, processes and services for integrated crop protection.

Headquartered at Malchow on the island of Poel, Prophyta manufactures its products at Wismar, Germany.  
 
Prophyta’s key product is Contans which is a biological plant protection product almost like a pesticide. 
 
The acquisition seems a strategic fit for the company as it complements the existing portfolio and will enable Bayer to offer an integrated crop solutions based on high-value seeds, innovative crop protection solutions and customized services. 
 
The financial terms of the deal were not disclosed. Bayer CropScience expects to close the acquisition in a few weeks.  In addition, the acquisition will enable Bayer CropScience to further leverage its technology platform acquired through Athenix Corporation and AgraQuest.
 
We note that Bayer has been quite active on the acquisition front lately. In Aug, the CropScience unit of the company acquired AgraQuest, Inc., formerly a global supplier of innovative biological pest management solutions, for $425 million (approximately €340 million) in addition to milestone payments.
 
The acquisition has boosted Bayer’s fruits and vegetables business while building a strong technology platform based on "green" products.
 
More recently, the HealthCare unit of Bayer AG received necessary regulatory approval from the Federal Trade Commission to complete its acquisition of Teva Pharmaceutical Industries Limited’s (TEVA - Analyst Report) animal health unit in the US.
 
In Sep 2012, Bayer had announced that in a bid to diversify its business and expand its animal health business, it inked a deal with Teva to buy its animal health unit.
 
As per the deal, Bayer will be paying $145 million, including an upfront payment of $60 million along with a total of $85 million in milestone payments on the successful and timely achievement of manufacturing and sales targets. The deal will also give Bayer access to Teva’s 300-employee manufacturing site at St. Joseph.
 
We view the acquisitions as positive and reiterate our Neutral recommendation on Bayer which carries a Zacks Rank #3 (Hold). Right now, Novartis AG (NVS - Snapshot Report) looks attractive with a Zacks Rank #2 (Buy).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
GREEN PLAIN… GPRE 36.46 +3.79%
MATRIX SERV… MTRX 30.90 +2.93%
ENZO BIOCHE… ENZ 5.20 +2.77%
GENTIVA HEA… GTIV 15.82 +2.73%
VIPSHOP HOL… VIPS 191.34 +2.23%