By Heather Haddon and Jacob Bunge
When Barry Glantz heard the news that Bayer AG was bidding for
Monsanto Co., the mayor of the St. Louis suburb where the
agricultural giant is based quickly called a company executive he
has known for years to find out what it could mean locally.
But with the offer so fresh and the company's future far from
clear, Mr. Glantz says he learned little. Now much of the rest of
the region is in a similar state of anxiety about the St. Louis
institution that gives millions of dollars to local charities and
whose name graces everything from a Washington University
life-sciences lab to a city YMCA.
"They have bigger fish to fry than the city of Creve Coeur, but
we always wanted them to be aware of what a good corporate citizen
they have been to the community," said Mr. Glantz, mayor of the
suburb 12 miles west of St. Louis where the company moved its
headquarters decades ago.
Bayer last week outlined a $62 billion offer for Monsanto, a
deal that would create the world's largest seller of seeds and
pesticides and rank as the largest-ever foreign acquisition by a
German company. Bayer, which is based in Leverkusen, Germany, said
it plans to make St. Louis its global base for the companies'
combined seed business and its North American agricultural
operations.
Monsanto rejected the offer but said it remained open to further
discussions. "Whether or not there's any transaction with Bayer, we
see our commitment to our community support continuing as our
business grows, " a Monsanto spokeswoman said.
Still, the possible takeover of the company, which traces its
roots to a small sweetener maker in downtown St. Louis in 1901,
echoes a long series of corporate-restructuring moves that have
eroded the presence of some of the region's big corporate
players.
The 15-county St. Louis metropolitan region, which includes a
swath of Illinois on the other side of the Mississippi River, was
home to nine Fortune 500 companies last year, down from 12 in 2000,
according to an analysis by the Open Markets Program, a nonpartisan
public-policy institute.
Companies that dropped off the list in recent years include the
Solutia Inc. chemical company, Anheuser-Busch Cos., Furniture
Brands International Inc. and financial adviser A.G. Edwards
Inc.
Once a manufacturing hub for beer, heavy industry and machinery,
St. Louis saw its population peak in 1950 at 856,800. It has fallen
to about 310,000 today as residents have moved to the surrounding
suburbs. With 2.8 million people, greater St. Louis was in the top
20 largest metropolitan areas last year, and it has gradually grown
over time.
The region has lost manufacturing jobs as big corporations have
left or slimmed down. The St. Louis metropolitan region was home to
114,000 manufacturing jobs last year, down from 202,400 in 1990,
according to the Bureau of Labor Statistics.
Companies in the city or county of St. Louis have reported
slashing more than 3,100 employees since July 2014, according to
state notices. Big corporate reductions included Macy's
announcement in January that it was closing a call center and
eliminating its 750 jobs.
Earlier this year, St. Louis suffered a psychic blow when the
owner of the St. Louis Rams decided to move the National Football
League team to Los Angeles.
"We just hated them for that and forgot about them soon after,"
said Laura Rossmann, a St. Louis nonprofit fundraising
consultant.
Few corporate takeovers affected St. Louis as much as InBev NV's
acquisition of Anheuser-Busch Cos. in 2008. Belgium-based InBev
immediately began dismantling the largest U.S. brewer, and it
slashed the company's U.S. work force by 30% to 12,938 workers
between 2007 and 2015.
St. Louis alone lost 60% of its corporate workers as InBev
eliminated 1,214 of its 2,037 corporate jobs, according to a 2015
report by the U.S. Senate's subcommittee on investigations.
St. Louis has recovered most of the jobs it lost from the
recession in the last year but has trailed the national average and
other Midwestern cities such as Indianapolis and Chicago, said Kurt
Rankin, an economist with PNC Financial Services Group Inc.
focusing on the Midwest.
The area has a highly educated workforce, the cost of doing
business is comparatively low and the housing market has started to
pick up, said Charles Gascon, a regional economist at the Federal
Reserve Bank of St. Louis.
A revitalization of downtown St. Louis remains in its infancy,
but the population of two of its core neighborhoods climbed to
7,660 in 2010 from 3,010 in 2000 as apartments were constructed and
renovated.
Monsanto began expanding its presence from St. Louis to the
surrounding suburbs in the 1950s.
Last year, the company's 247-acre corporate-headquarters campus
was home to 4,170 employees, accounting for 8% of the Creve Coeur's
total employment, and the company was the city's second-largest
employer behind Mercy Hospital St. Louis, according to city
data.
Monsanto also has given tens of thousands of dollars to various
city-led projects over the last five years, Mr. Glantz said.
Frequently the target of controversy over its genetically
modified crops, Monsanto is a major corporate giver, particularly
in the area of sciences and agriculture, along with schools and
arts programs in the region. The company and its charitable arm,
the Monsanto Fund, last year donated about $12 million in the St.
Louis area, according to Monsanto, making it one of the biggest
foundation givers in the state.
"It would be somewhat of a bitter pill" if Monsanto's
headquarters left the city, said Philippe de Lapérouse, the St.
Louis-based director of food and agribusiness for HighQuest
Partners LLC, a management consulting firm. "But not a death
knell."
--Tripp Mickle contributed to this article.
(END) Dow Jones Newswires
May 30, 2016 19:01 ET (23:01 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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