Seed company Monsanto has rejected a $62 billion acquisition bid by German agriculture supplier Bayer as 'incomplete and financially inadequate', but said it was open for further negotiations.
Monsanto's decision puts pressure on Bayer to decide whether to raise its bid.
Monsanto shares ended trading up 3.1 percent at $109.3 in New York, substantially below Bayer's bid price.
"We believe in the substantial benefits an integrated strategy could provide to growers and broader society, and we have long respected Bayer’s business," Monsanto Chief Executive Hugh Grant said in a statement.
"However, the current proposal significantly undervalues our company and also does not adequately address or provide reassurance for some of the potential financing and regulatory execution risks related to the acquisition," he added.
Combining Monsanto, the world's largest seed company, with Bayer's crop protection products would create the world's largest agricultural supplier.
"Monsanto is a perfect match to our agricultural business," Bayer CEO Werner Baumann said in a video message posted on his company's website.
"We would combine complementary skills with minimal geographic overlap."
"The acquisition of Monsanto checks all the boxes in terms of strategic fit and value creation potential," he added.
"At the same time, ongoing consolidation activities in the industry make this combination by far the most attractive one."
Low commodity prices—which have caused farmers to cut orders for supplies—have piled the pressure on agricultural suppliers like Monsanto, which is based in Saint Louis, Missouri.
The industry has seen two big merger deals recently, which are still undergoing regulatory reviews in the United States.
