Happy New Year
Thought it time that I say hello after a longish break with some
thrilling news from the Monsanto site. Over a 1000 jobs being shed to
finance seed company acquisition. For those of you who know something
about Monsantos plans re: non-reproducing seeds, the monopolising
interests of Monsanto over the world's seed stock will gladden your
hearts, particularly if you hold shares in the company. Check out the
Monsanto Web Site. Here is a company that really cares for you.
I take it that copyright means the right to copy.
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Monsanto Announces Plan to Fund
Seed Company Acquisitions
ST. LOUIS, November 11, 1998 - Monsanto
Company (NYSE: MTC) today announced a plan
to fund its recent seed company acquisitions
through a series of financing transactions, a
combination of divestitures, and cost reductions.
Specifically, these restructuring actions include:
Debt and equity financing plans which are
described in separate announcements
and are summarized below.
Divestitures of businesses expected to
generate gross proceeds of at least $1
billion. Additional divestitures also are
under consideration, with final decisions
expected in 60 days, subject to market
conditions.
Simplification of the company's
management structure and a reduction of
administrative costs.
During the next few weeks, Monsanto plans to
raise up to $4 billion in a series of financing
transactions. These transactions will include the
issuance of approximately $1 billion of common
stock, roughly $500 million of adjustable
conversion-rate equity security units (ACES),
and approximately $2.5 billion of long-term,
unsecured debt. Additional information regarding
the securities to be sold will be announced
separately.
Monsanto expects the restructuring to eliminate
between 700 and 1,000 jobs, a number of which
will be at executive levels. These reductions will
be effective beginning the first quarter of 1999. In
addition, the company expects an additional
1,300 to 1,500 job reductions in entities to be
divested.
As a result of these and other actions,
Monsanto expects its administrative costs will
be reduced by roughly 20 percent on a
comparable basis in 1999 vs. 1998. Marketing
costs will increase with the launch of key
pharmaceutical and agricultural products.
Technology costs will also increase, primarily
driven by costs associated with Monsanto's
recently acquired seed businesses.
Monsanto anticipates pretax restructuring and
special charges to implement these decisions in
the range of $400 million to $600 million, which
it plans to take in the fourth quarter of 1998. The
cash outlays associated with these charges are
expected to be fully offset by cost savings within
18 months. "The actions announced today
continue a long-term process," said Monsanto
Chairman and Chief Executive Officer Robert B.
Shapiro. "From 1992 to 1995, we developed our
strategy to transform Monsanto into a leading
life sciences company. From 1995 to the
present, we've been putting together the
resources and capabilities - business portfolio,
people, technologies and infrastructure - to carry
out that strategy. The period from 1999 to 2001
will be one of execution in the marketplace and
delivery for our shareowners."
Shapiro added that Monsanto does not plan to
make any additional major acquisitions once the
previously announced seed company
transactions are completed.
Monsanto is a life sciences company,
committed to finding solutions to the growing
global needs for food and health by sharing
common forms of science and technology
among agriculture, nutrition and health. The
company's 28,500 employees worldwide make
and market high-value agricultural products,
pharmaceuticals and food ingredients.
This release includes forward-looking statements regarding
financing and other business plans, and future
performance. These forward-looking statements are based
on current plans and expectations, and on currently
available information and assumptions that the company
believes to be reasonable. However, forward-looking
statements necessarily involve risks and uncertainties, and
actual results may differ materially from those suggested.
Certain factors that could cause actual results to differ
materially include, but are not limited to: worldwide
economic conditions, particularly those affecting the
agricultural and pharmaceutical businesses; the ability of
obtain funding upon favorable terms to finance growth; the
ability to complete and integrate acquisitions and
alliances, and to complete sales of businesses on
favorable terms and conditions at appropriate times; the
successful realization of research and development efforts,
including the ability to secure and defend intellectual
property rights and to be first to market; obtaining and
maintaining regulatory approvals and consumer acceptance
of key products; the effect of generic competition,
particularly with respect to glyphosate-based herbicides;
and other factors listed in Monsanto's 10-K, 10-Q and 8-K
filings with the Securities and Exchange Commission.
-oOo-
For additional information, please contact:
Lori J. Fisher
314-694-8535
[EMAIL PROTECTED]
