Monsanto Co. (MON:US) said it asked the U.S. Securities and Exchange Commission to investigate an analyst’s report that speculated the company may sign a consent decree with the Department of Justice to settle antitrust concerns.
The company referred the Oct. 5 report by Mark McMinimy, a Washington-based agribusiness analyst at Concept Capital Washington Research Group, to the SEC last week to probe possible stock-price manipulation, Scott Partridge, general counsel for St. Louis-based Monsanto, said today. McMinimy didn’t immediately respond to a voicemail requesting comment.
“The primary message of the report is completely incorrect,” Partridge said in a telephone interview.
Partridge said it was “disturbing” that the Concept Capital report came out a day before the company’s earnings were reported. It will be up to the SEC to “determine whether this was simply reckless or intended to put the company’s stock into play” or “whether it truly was an effort by a competitor to injure us.”
Monsanto, the world’s largest seed company, has been cooperating since last year with a Justice Department investigation into potential anticompetitive practices in the seed industry. DuPont Co. (DD:US), the second-biggest seed company, has alleged in a federal lawsuit that Monsanto unfairly uses genetic licenses to dominate the market for engineered seeds.
McMinimy said in the report, titled “Is a Consent Decree with Monsanto Near at Hand?,” that an agreement would be structured to ensure that rival seed makers can produce generic Roundup Ready soybeans, which are engineered to resist Monsanto’s Roundup herbicide, when the patent on the technology expires in 2014.
Monsanto fell 57 cents, or 1 percent, to $54.12 at 4:15 p.m. in New York Stock Exchange composite trading. The shares (MON:US) rose 2.2 percent the day McMinimy released his report.
John Heine, an SEC spokesman, declined to comment.
Monsanto Chief Executive Officer Hugh Grant has said the company will allow competitors to produce generic Roundup Ready seeds after the patent expires. Partridge said today that the company is taking steps to achieve that, including a commitment through 2021 to provide safety data to key soybean-importing nations to maintain import approvals.
Grant said in a January interview that the decision to facilitate generics sets the template Monsanto expects to follow as other technologies lose patent protection.
About 87 percent of U.S. soybean plantings contain Monsanto’s Roundup Ready trait. Monsanto has begun switching growers to its more expensive Roundup Ready 2 Yield product, predicting the seeds will boost soybean output 7 percent to 11 percent.
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