German drugs and chemicals group Bayer AG said it made an offer to buy US seeds company Monsanto Co for $122 per share in cash, or a total value of $62 billion including debt, to create the world’s biggest agricultural supplier.

Bayer said yesterday that the proposal made to Monsanto’s management represented a 37 per cent premium over the closing price of Monsanto shares on May 9, before rumours of a planned bid emerged.

Monsanto disclosed last week that Bayer had made an unsolicited takeover offer for the group, triggering an investor backlash in which one of the German company’s major shareholders called the move “arrogant empire-building”.

Bayer said it planned to finance the deal with a combination of debt and equity, primarily via a rights offering. Equity would account for about a quarter of the deal value.

It expects annual earnings contributions from synergies of around $1.5 billion after three years, plus additional future benefits from integrated offerings, a reference to Bayer’s push to combine the development and sale of seeds and crop protection chemicals.