Monsanto, the Missouri-based maker of genetically modified crop seeds, has rejected a revised takeover bid by Bayer of Germany as 'too cheap'.
This has been seen as an expected move that will prolong the bidding contest for the company.
In response, Bayer said it was "disappointed" but that it was "looking forward to continued dialogue" with Monsanto.
The rejection signals that Bayer, which is seeking to create a one-stop shop for farmers during a wave of mergers in the agriculture business, will have to work even harder to try to consummate a deal.
Monsanto said on Tuesday its board unanimously viewed Bayer's latest bid as "financially inadequate and insufficient to ensure deal certainty."
"Monsanto remains open to continued and constructive conversations with Bayer and other parties to assess whether a transaction that the board believes is in the best interest of Monsanto share owners can be realized," the company said.
Syngenta AG, which Monsanto tried to buy last year, agreed in February to be acquired by ChemChina for $43 billion. Dow Chemical Co (DOW.N) and DuPont (DD.N) struck a $130 billion mega-merger late last year.
Monsanto said last month net income tumbled more than 37 percent to $717 million in the quarter ended on May 31.
It cited a global glut of generic glyphosate, the active ingredient in its Roundup herbicide, and delays in securing European Union import approval for its next-generation biotech soybeans.
