The Monsanto Company has announced “a definitive agreement” to acquire Emergent Genetics, the third largest cotton seed company in the U.S.

The $300 million cash and commercial paper transaction will complete “a strategic cotton germplasm and traits platform modeled on the company’s leading corn and soybean strategy,” says Hugh Grant, chairman, president, and chief executive officer of Monsanto.

Through its Stoneville and NexGen brands, Emergent Genetics has about 12 percent of the U.S. cotton seed market.

“Just as our Dekalb and Asgrow brands do in corn and soybeans, we believe the Stoneville and NexGen brands will provide a powerful showcase of our breeding advances and biotechnology traits in the U.S. cotton seed market,” Grant said.

“Coupled with the germplasm development and licensing in our cotton states business, our cotton seed business can mirror the successful model we’ve established through branded and licensed channels in corn and soybeans.”

Monsanto has “a strong base business” built on seeds and traits, Grant said, and the addition of Emergent is expected “to give us a complementary cotton platform.”

Kerry Preete, Monsanto's vice president of U.S. crop production, said during a press conference to reporters that plans are to widen its number of varieties with other brands.

He described the acquisition as a “licensing platform” for such a move.

“We want to continue to license our traits broadly into the marketplace. That is the best way to provide choice to farmers,” he said.

Coming on the heels of an announcement in January that Monsanto would acquire Seminis, the world’s largest developer, grower, and marketer of vegetable and fruit seeds, he said the Emergent acquisition “will allow us to accelerate our growth.”

Seminis is the global leader in its industry, supplying more than 3,500 seed varieties to commercial fruit and vegetable growers, dealers, distributors, and wholesalers in more than 150 countries around the world.

That acquisition carried a $1.4 billion price tag.

“Over the next year, we will focus on three areas: execution of our business plans, assimilation of these new businesses, and replenishing our balance sheet,” Grant said.

Under the direction of Chief Executives Mark Wong and Sam Dryden, Emergent has established itself as a leading company in the cotton industry.

In addition to its U.S. business, it also has two leading cotton seed brands in India and a solid presence in several other smaller cotton-growing markets.

It is one of the world’s leaders in the application of new technologies for development of cotton seed that is resistant to insects and herbicides.

Emergent’s business includes research and/or production facilities across 14 states in the U.S. Internationally, it has operations in Spain, Greece and Turkey.

The deal does not include Emergent Vegetable A/S, the company’s vegetable seed business based in Denmark.

“We’re very proud of the Emergent business and the leadership position that our organization has been able to build in the U.S. and Indian cotton industries,” Wong said. “The addition of Emergent to Monsanto is a combination that will take Monsanto’s cotton business to the next level, helping it to grow, while at the same time bringing new technology and products that will benefit the cotton industry.”

Building from Emergent’s strong business foundation, Grant said Monsanto “will work to apply its biotechnology traits and molecular breeding capabilities to accelerate the speed at which new stacked-trait and second-generation products reach cotton producers.

“This combination will pair some of Monsanto’s terrific biotechnology and breeding advances with the backbone of proven cotton brands. This will be a nice complement to our continued commitment to broadly license biotechnology traits.

“The bottom line for cotton producers,” Grant said, “is that we believe we will be able to more quickly move the most innovative technology into more stacked-trait products, while still insuring broad choices in a competitive market.”

The acquisition is subject to regulatory approvals and is expected to close “as soon as practical,” he said.

Preete said the company would evaluate Emergent Genetics production locations in the coming few months to determine operational consolidations or changes.