Bayer Faces German Class Action Suit Over $63 Billion Monsanto Deal

(Bloomberg) -- Bayer AG is facing a class action lawsuit in Germany from investors claiming that it concealed risks associated with the takeover of Monsanto Co. 

A court in Cologne is allowing the suit to go forward. Class actions are less common in Germany than in the U.S.

The TILP law firm spearheading the litigation said it’s representing more than 250 institutional investors and private investors with total claims that could exceed 1 billion euros ($1.1 billion), according to a statement.

Bayer downplayed the risk associated with the suit, calling the claims “baseless” and saying that it isn’t changing its views of its legal situation. The German company cited several independent reviews of the $63 billion Monsanto deal that concluded it had performed adequate due diligence.

Bayer continues to suffer from the fallout of the purchase, which turned it into the world’s largest supplier of agricultural seeds and crop chemicals but also saddled it with costly legal problems. The biggest hurdle has been dealing with at least 125,000 U.S. lawsuits claiming that the Monsanto weedkiller Roundup caused cancer, a view Bayer rejects. 

Bayer fell 1% to 45.95 euros in Frankfurt trading on Wednesday. The shares have lost about half their value since the Monsanto deal closed in 2018. 

While Bayer is hoping a victory at the U.S. Supreme Court will put an end to that costly litigation, its backup plan is to convince investors that it can achieve that goal by spending as much as $16 billion.

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