A billionaire and a senator turn their attention to Monsanto, Syngenta

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Darrell Hoemann/Midwest Center for Investigative Reporting

An Illinois Monsanto facility on May 19, 2015.

As news of a possible Monsanto-Syngenta merger keeps rolling out, multiple media outlets are reporting that two noteworthy figures have gotten involved with the process.

Billionaire investor John Paulson of Paulson & Co. has took on a large number of shares in the Swiss chemical company Syngenta, according to reports from Bloomberg Business. The moves could signal his support of a takeover.

Bloomberg Business reported on July 14:

The stake, which hasn’t been publicly disclosed, may put Paulson & Co. among the 20 largest shareholders in Syngenta, one person said. John Paulson has a reputation for using his hedge fund to take large positions in companies engaged in ongoing merger discussions and voicing his support for a transaction. It’s not clear if Paulson will go public with his stake and his support of a Monsanto-Syngenta merger.

The Swiss company increased 1.6 percent to 394 francs a share as of 9:03 a.m. in Zurich, short of the 449 francs offered by its suitor.

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In addition to Paulson, U.S. democratic Sen. Dick Durbin of Illinois has also chimed in on merger discussions, according to reports from the St. Louis Post-Dispatch. The congressman met with Monsanto CEO Hugh Grant on Tuesday to discuss tax ramifications and liabilities.

If a takeover attempts are successful, Monsanto officials have considered establishing headquarters in the United Kingdom, meaning the seed company could duck certain federal taxes.

"Like so many large companies in the U.S., Monsanto has prospered in large part due to U.S. taxpayer-funded programs and services," Durbin said. "Where would Monsanto be without the U.S. farm program and world-class research labs?"

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Durbin sponsored bill S.198 – the Stop Corporate Inversions Act of 2015 – earlier this year.

The act seeks to amend the revenue code and revise rules on corporate taxation, specifically the tax breaks companies receive when they acquire foreign companies to reincorporate in a foreign jurisdiction with lower income tax rates.

The bill is currently held up in the Senate Committee on Finance, where it has been since January.


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