(Adds CEO quote, updates share price)
By Karl Plume
CHICAGO, April 5 U.S. seeds and agrochemicals
company Monsanto Co, which is in the process of being
bought by Germany's Bayer AG for $66 billion,
reported a better-than-expected quarterly profit on Wednesday,
helped by strong demand for its soybean and corn seeds.
Monsanto's shares were up 1.6 percent at $115.84 after
earlier hitting a 22-month high of $116.37.
The world's largest seed supplier said sales of corn seeds
and traits rose 8 percent, while sales of soybean seeds and
traits jumped 10.2 percent in the second quarter ended Feb. 28,
as farmers in the United States prepare to plant the largest
combined corn and soybean acres on record. Robust late-season
seed demand in South America further propelled gains.
Monsanto agreed in September to a $128-per-share buyout
offer from Bayer that, if approved by regulators, would create a
company commanding more than a quarter of the world market for
seeds and pesticides.
The deal came amid a wave of consolidation in the seeds and
agrochemicals industry. Along with earlier mergers linking Dow
Chemical with DuPont and ChemChina with Syngenta
AG, the sector may ultimately be dominated by just four
ChemChina's acquisition of Syngenta won conditional approval
from U.S. and European Union antitrust authorities this week.
The EU signed off on the Dow and DuPont
deal last week, provided certain conditions are met.
Monsanto said it remains confident its deal will pass
regulatory muster and is on track to close by the end of 2017.
"We are heartened to see the deals ahead of us making
progress," Chief Executive Hugh Grant said. "The unique thing
about this deal is there a very limited amount overlap."
Reuters reported last month that the two companies were
launching asset sales worth $2.5 billion as they seek regulatory
Monsanto, best known for Roundup herbicide and
genetically-engineered corn and soybeans, also said it now
expects full-year ongoing earnings per share at the high end of
its forecast range of $4.50 to $4.90 per share for the 2017
Net profit attributable to Monsanto rose to $1.37 billion,
or $3.09 per share, in the second quarter, from $1.06 billion,
or $2.41 per share, a year earlier.
Excluding one-time items, Monsanto earned $3.19 per share,
topping analysts' average estimate of $2.79 per share, according
to Thomson Reuters I/B/E/S.
Net sales rose 12 percent to $5.07 billion. Analysts on
average had expected sales of $4.73 billion.
(Additional reporting by Arathy S Nair in Bengaluru; Editing by
Sai Sachin Ravikumar and Marguerita Choy)