German-based Bayer plans to take over US seeds group Monsanto. The deal would create the world’s largest integrated pesticides and seeds company but would limit the number of competitors selling herbicides and seeds in Europe.

Bayer’s move to combine its crop chemicals business with Monsanto’s industry-leading seeds business is the latest in a series of major agrochemicals tie-ups.

If Bayer does not close the deal by June 14, Monsanto could withdraw from the takeover agreement and seek a higher price.

It has already secured the go-ahead from key jurisdictions, including the European Union, Brazil and Russia. Apart from the United States, it still needs clearance in Canada and Mexico.

Bayer said synergies from folding Monsanto into its organisation would be about 300 million dollars below its previous target because it will have to sell more businesses than initially expected.

Bayer has a plan to create combined offerings of seeds and pesticides with the help of new digital farming tools, which include sensors, software and precision machines.

There are concerns the proposed acquisition could reduce competition in a number of different markets resulting in higher prices, lower quality, less choice and less innovation.

A merger would also reduce competition in the market for the genetic traits behind herbicide tolerance, which are typically licensed out to third-party seed companies.