More than a few hurdles face German chemicals and pharmaceutical giant Bayer AG before its unsolicited offer to buy Monsanto becomes reality.
But assuming antitrust concerns, financing challenges, skeptical shareholders and hesitant Monsanto leadership don’t derail the offer, how worried should St. Louis be?
The Creve Coeur-based biotech giant that helped pioneer genetically modified crops 20 years ago and is now the world’s largest seed company is arguably the crown jewel in the region’s thriving plant sciences scene.
Monsanto’s presence helps lure the best and brightest in plant science and genetic engineering to the area, and the biotech startups that choose to put down roots in the region know the agrochemical behemoth could become a major customer, or even a buyer, of their technology.
Monsanto is heavily invested in the region, and it’s in their interest to maintain and grow their workforce here, said Donn Rubin, the president and CEO of BioSTL, a nonprofit organization that focuses on boosting the sector in the region. If Bayer ultimately buys the company, it likely wouldn’t change plans already in motion or ignore the region’s strong plant sciences workforce.
“It’s premature to be worried,” Rubin said. “And there’s no reason to automatically think that some change in ownership will drain St. Louis of the smart and influential decision-makers on issues that impact our own startup community or the community we’re trying to attract from outside St. Louis.”
Monsanto is in the midst of a $400 million expansion of its Chesterfield Village Research Center that will add hundreds of research and development jobs to the area. And beyond Monsanto, there are hundreds of plant science Ph.D.s who work in other companies or research institutions such as the Donald Danforth Plant Sciences Center, across Olive Boulevard from Monsanto’s campus.
The region has a “concentration of talent in the plant sciences that is second to none,” Rubin said, pointing to the area’s research universities, incubators, large agricultural companies and startups.
So even if the Germans start calling the most of the shots, leaders in the area’s biotech community don’t see it dampening St. Louis’ reputation as a plant and life sciences research hub or slowing the momentum the region has built.
“It is in the interest of any corporation in the plant science space, whether a U.S. corporation or an international corporation, to have a significant and meaningful presence in that St. Louis ecosystem,” Rubin said.
Economic development officials point to the estimated 15,000 people who work at some 700 bioscience companies. Incubators such as the St. Louis Economic Development Partnership’s Helix Center and the Danforth Center’s BRDG Park give ag-related startups a place to commercialize their technology.
That pool of talent is likely to continue attracting investment and building on itself, no matter where Monsanto’s headquarters are, said Hart Nelson, the St. Louis Regional Chamber’s director of public affairs and issues management. And Monsanto or a new parent will want to keep employees as part of that pool, and it’s not likely to move its labs following the big investment it made in Chesterfield.
“Regardless of where their headquarters are going to be, the R&D footprint is still going to be here, and I think that’s where a lot of the linkages are,” Nelson said.
Of course, there are downsides that could follow a change in ownership. It’s “always a risk” that the company’s philanthropy and involvement narrows to only technology or startups that directly relate to the company’s products, said Thad Simons, the lead managing partner of agriculture technology startup accelerator Yield Lab. He noted that Yield Lab, which recruits a range of early-stage agricultural companies, some of which might not directly benefit Monsanto, received support from the company to get started.
“It’s a more complex decision-making process,” Simons said. “You have to go somewhere else to get the final decision on something.”
While he would be “very disappointed” if Monsanto’s headquarters were no longer in St. Louis, “the assets are still here,” Simons noted. “The human capital is still here.”
A new parent, however, might not have the same relationships with local governments and economic development officials that advanced a new plant science district planned in Creve Coeur.
Monsanto is an integral piece of the planned plant science district, which would encompass Monsanto’s campus, the Donald Danforth Plant Science Center and incubators for life science companies near Lindbergh and Olive boulevards.
“Monsanto is a huge part of that, and they are the reason and were the catalyst for everything to be there,” said Sheila Sweeney, CEO of the St. Louis Economic Development Partnership.
She’s confident the region’s concentration of talent means any new parent will want to stay involved with the area’s efforts to further develop it.
“If it’s Bayer or any other company in the coming months, our district still is strong and has great potential and we would move forward with it,” Sweeney said.
Jacob Barker • 314-340-8291
@jacobbarker on Twitter
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