Monsanto divests US cottonseed businesses

By Lorraine Heller

- Last updated on GMT

Related tags Investment Us Monsanto

Agribusiness Monsanto has completed the divestiture of its US
branded cottonseed business, in a move required as part of its
takeover of the Delta and Pine Land Company (DPL).

The St Louis-based firm earlier this month announced its acquisition of DPL, but in order for the merger to proceed, the US Department of Justice required the firm to conduct a series of divestitures in order to limit the consequences of the loss of competition in the cottonseed market.

The final judgment followed a civil lawsuit filed by the federal government in US District Court in Washington, which claimed that the deal would result in higher traited cottonseed prices, and also block further developments of traits for the crop.

As a result, in accordance with the Department of Justice Requirements, Monsanto today announced the completion of the sale of its Stoneville cottonseed brand and related business assets to Bayer CropScience for $310m.

It has also sold its NexGen cottonseed brand and related business assets to Americot for $6.8m.

The moves, said Monsanto, will allow the firm to immediately work to combine the Delta and Pine Land business with its existing operations and policies, which have until now remained separate.

The acquisition is expected to increase innovation in the cotton industry by combining Monsanto's technology with DPL's germplasm.

It will also increase the overall competitiveness in the US cottonseed industry and in the global marketplace, said chairman, president and chief executive officer of Monsanto Hugh Grant in a statement today.

The company also reaffirmed its policy not to develop or utilize sterile seed technology, such as the so-called 'terminator' technology, to which Delta and Pine Land has rights.

Cottonseed is a protein rich by-product of the textile industry, around 1.65kg of which is left over for every 1kg of cotton fiber.

But because it is also high in gossypol, a toxin that causes heart and liver damage and male sterility in monogastric animals, until now this abundant protein source has remained untapped for human nutrition.

At present, as much as 50 per cent of cottonseed from the US is used by the food industry, but only after it has been processed to remove the gossypol from the oil.

The oil is then used in food products and for cooking - and indeed, is appreciated for its flavor - while the remaining protein-rich meal is used as livestock feed.

But researchers from Texas A&M University last year reported they found a way to genetically engineer cottonseed to remove toxins, making it a potential source of protein for undernourished populations.

Related topics Fats & oils

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