MINNEAPOLIS, Oct. 20 /PRNewswire/ -- Cargill and Monsanto (NYSE: MTC)
announced today that they have reached an agreement that resolves problems
related to Monsanto's purchase of Cargill's international seed business last
Under the agreement, Cargill compensated Monsanto for lost germplasm (the
reproductive tissue of seeds) and other expenses associated with the problems
that were uncovered in Cargill's international seed business. The settlement
was included in a reserve taken in the fourth quarter of Cargill's 1998-99
Monsanto acquired Cargill's international seed business in October 1998
for $1.4 billion. The sale involved temperate and tropical corn and other
crops, but did not include Cargill's North American seed business.
Cargill discovered the problems during an investigation into allegations
by Pioneer Hi-Bred International that Cargill had wrongly obtained some
Pioneer genetic material. Pioneer filed suit against Cargill in October 1998,
after Monsanto's acquisition of Cargill's international seed business. Pioneer
later filed suit against Monsanto, claiming that some of Pioneer's genetic
material was included in Cargill's international seed business.
"We have been very open and forthright with Pioneer and Monsanto from the
moment we discovered the problem and have worked with both companies to remedy
the situation," said Fritz Corrigan, president of Cargill's Agriculture and
Biosciences Group. "Both Cargill and Monsanto have thoroughly investigated
the problem to ensure that any material that should not be for sale has been
removed from our research program and the market. We deeply regret the
situation and are pleased that we have reached this agreement."
"It's unfortunate that some problem areas have been identified in the
Cargill assets we acquired," said Monsanto President Hendrik Verfaillie.
"However, we're pleased that a suitable arrangement has been agreed upon by
both companies, and we look forward to furthering our strong business
relationship with Cargill."
Cargill is an international marketer, processor and distributor of
agricultural, food, financial and industrial products with 82,000 employees in
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
31,800 employees worldwide make and market high-value agricultural products,
pharmaceuticals and food ingredients.
SOURCE Monsanto Company