DELTA AND PINE LAND COMPANY
Moderator: Tom Jagodinski
08-15-06/10:30 am CT
Confirmation #4627536
Page 1
DELTA AND PINE LAND COMPANY
Moderator: Tom Jagodinski
August 15, 2006
10:30 am CT
Operator: Good afternoon. My name is (Louanna) and I will be your
conference operator today. At this time, I would like to
welcome everyone to the discussion of Delta and Pine
Land/Monsanto Transaction conference call. All lines have
been placed on mute to prevent any background noise.
After the speakers' remarks, there will be a question and
answer session. If you would like to ask a question during
this time, simply press star, then the number 1 on your
telephone keypad.
Thank you. Mr. Jagodinski, you may begin your conference.
Tom Jagodinski: Thank you, (Louanna). Good morning, everyone.
I have - although we're in separate places, I have on the
phone with me Rick Greene, our Senior Vice President and -
of International Corporate Development, and Kenny Avery,
our Vice President of Finance and Treasurer. And we have
quite a few participants; we have about 30 to 45 minutes
for this call.
I guess, as everyone is aware by now, that we've made an
announcement this morning that the Board of Directors of
Delta and Pine has agreed to accept a $42 per share cash
offer from Monsanto. The deal is obviously subject to DOJ
approval and also subject to Delta and Pine shareholders
favorably voting for the transaction. We think the deal is
an excellent value for our shareholders and that's one of
the reasons - the primary reason why we moved ahead with
the transaction.
We have been working, as many of you know, on executing
what we consider to be an excellent business plan over the
last six or seven years in that we brought in new
technologies, licensing technologies from others, and
continue to develop our product pipeline. However, in the
evaluation of whether or not to execute the transaction,
we look out - we looked out and see and realized that the
new technologies are some years away still, beginning in
2008 or 2009.
And when you look at the opportunity that this offer
brings compared to remaining independents, the Board of
Directors, after considering many factors -- the
technology pipeline, the industry space, the issues around
acreage and farm (bill) and so forth, the Board just
decided it was time to go ahead and execute this
transaction.
Anyway, I have some other remarks. In this particular
transaction, unlike the 1998 transaction, we have much
stronger deal protection mechanisms in place. The Monsanto
realizes, I believe, that it will have to sell Stoneville
and if it is - if it does, it will do so. And there are
other things in place that protect us that were unlike the
1998 Agreement.
As a result, the execution disagreement, the arbitration
where Monsanto was suing us essentially, that was to
commence yesterday and, of course, that's when we had
counterclaims against them, that arbitration has now been
settled and terminated.
With respect to the ninth Delta and Pine versus Monsanto
case, this is the one that originated from or resulted
from the 1998 failed merger; that case has been stayed,
meaning it's put on hold and assuming that the transaction
closes, that obviously, at that particular time, the case
would be dismissed.
With that, that concludes my opening comments about the
deal. We will file an 8-K later today. I will provide some
general comments about the terms of the Agreement but I'm
not in a position to - we're not in a position to discuss
intimate details.
Anyway, with that, (Louanna), I'd like you to open it up
for questions.
Operator: At this time, I would like to remind everyone, in order to
ask a question, please press star, then the
number 1 on your telephone keypad.
Your first question comes from (Mike Judd), Greenwich
Consultants.
(Mike Judd): Good morning and congratulations on your announcement.
Tom Jagodinski: Thank you.
(Mike Judd): A question about the - have you recently negotiated
or can you just kind of give me an update of the
relationships that you have with Syngenta and Monsanto,
what some of the recent his - sorry, not - Syngenta and
DuPont, what are some of the recent history there, any,
you know, near-term deals that you have with them, and how
they might be impacted by today's announcement?
Tom Jagodinski: Certainly. As many of you know, in 2002, we
executed a technology - or Product Development Agreement
with a company called Verdia, that company was acquired by
Pioneer in 2004. And we cer - recently renegotiated the
Joint Venture Agreement that we had with them and also
expanded that relationship to gain access to some other
technologies principally related to soybeans.
And in the original transaction, we had access to the
DuPont (Gap) technology or it's basically, I'd like to say
safening technology, but in the renegotiated licenses, we
got access to optimum gap which is the dual herbi - it's a
safening system for - it's basically a dual gene system or
it safens the plant from (two) herbicides; and those
agreements were I guess executed probably in June.
The Syngenta transaction we entered into in 2004 relates
to VipCot which is an insect-resistant and cotton
technology - or technology for cotton. And both of these
contracts survived a change of control. And in the
interim, between now and the closing of the transaction,
we will continue to perform under those contracts,
continue to develop those products because we still are an
independent company and we will continue to execute the
business strategy that we have set forth until the closing
date occurs.
Now what happens after the change of control and when -
and then at that time, the company will have to decide and
I guess the technology part will have to decide what to do
with those licenses but the contractual terms are such
that they survived.
(Mike Judd): Very good. Thank you.
Tom Jagodinski: Yes.
Operator: Your next question comes from (Peter Butler), (Landfill)
Investments.
(Peter Butler): Yeah, hi. In view of the - you know, the gatekeeper
concept and the complications with your deals with
Syngenta and DuPont, how can either one of those guys
afford to let you go to give you up to Monsanto?
Tom Jagodinski: Well, we have a technology relationship with
them and let me be very clear. This - the contract - we
have a contract to sell the company to Monsanto and that
contract contains anti-shop provisions and I certainly
don't want to get crossways with those.
But from a strategic point of view, is generally, you
know, you can sell - I've always said this, you can sell
seed without trait incentive but you can't sell traits
without the seed. And as you know, (Peter), our long suit
is in the cotton germ plasm that we've developed over the
last 90 years. I mean I think we've got the best library
in the world.
And, you know, although recently, I guess in the last
seven or eight years, the market in the U.S. has changed
and our absolute share in the cotton market in the U.S.
has declined from those high 70s to just over 50. But, you
know, you've got Bayer and wise - I mean Bayer and Dow out
there.
You know, we still - you still have to have seed to put
your product in. And so - and in Monsanto's case, they
have both seed and traits.
(Peter Butler): Just a follow-on on that. Why couldn't you get
more? If - you've been making the case that your
litigation with Monsanto in your litigation, you have a
very strong case and you're playing on your whole - home
field in Mississippi. They have a substantial risk that
they lose which would be worth, you know, maybe more than
the amount of money they're paying for you. And then
secondly, related to that, why not - why don't you get
stock? Monsanto stock was pretty attractive.
Tom Jagodinski: Well, first of all, as with any litigation,
there is always a risk when you put your fate in the hands
of a jury; nobody knows how you're going to turn out. I
will also say that I think we do have an excellent case in
the '98 litigation and with respect to the arbitration
that's now been canceled, we didn't breach our licenses
and we don't think we had any risk of having the licenses
canceled which Monsanto is seeking to do.
But the fact is, you know, I've always told investors,
don't buy this stock for the litigation, buy this stock
for the, you know, the long-term appreciation of the
business and the core assets that we have. If you want to
look at the litigation, look at it as an upside.
And, you know, it's very difficult sitting here today to
understand or to know with any degree or precision how the
case would turn out; we could win and win big or we could
win nothing. And to date, you know, we've had some very
patient shareholders. We've spent over $50 million in
litigation on legal fees on those two matters. And it -
you know, management has spent a good deal of time having
to - you know, having to deal with those.
And I just think that considering what we see in the
industry, considering the fact that Monsanto has an
excellent technology pipeline, and considering our germ
plasm, and considering the EBITDA multiple that they're
paying for this company, we just think it was a fair price
at the time, considering all the facts and circumstances
that are relevant in the industry and the global cotton
industry and ag in general.
(Peter Butler): And why not stock?
Tom Jagodinski: Well, I guess there are a lot of reasons. I
suspect that if Monsanto were to issue stock, it probably
would be diluted. But I think the other thing is they have
a much higher multiple than we do and - or - and there
they traded at a much higher multiple. I think their
multiple is the highest in this sector and we're the
second highest. We were the second highest before this
deal was announced, I thought - I think we were trading at
12 or 13 times EBITDA if I'm not mistaken. But cash I
think was the preferred consideration by both parties.
(Peter Butler): Okay. Hey, thanks for the help and good luck to you, Jag.
Tom Jagodinski: Thanks, (Peter).
Operator: Your next question comes from (Kevin McCartney), Bank of
America.
Tom Jagodinski: Hi, (Kevin).
(Kevin McCartney): Hi, good morning, Jag. In the Monsanto call
just an hour ago, the company indicated that Delta and
Pine Land came for sale fairly recently, I believe it was
mid last week. Can you talk about the background of the
transaction and were there any particular catalysts or
events that may have changed in recent weeks that, you
know, would alter your view or the view of the Board with
regard to remaining an independent entity?
Tom Jagodinski: Well, the transaction - the discussions around
this particular transaction did kick off last week; we
started on Thursday and we finished it approximately 7:30
A.M. Eastern this morning. But anyway, the - or at least
that's when we all got home, let's put it like that, we
actually executed the contracts last night.
But I don't - I mean I wouldn't say that there was any
catalyst that I'm aware of that would change anything with
the parties, we're discussing certain strategic things and
we concluded this was the best path to go.
(Kevin McCartney): Was it a coincidence then that the timing was very close
to the start of the arbitration?
Tom Jagodinski: Well, you'd have to ask them that. I mean their - you'd
have to ask them that.
(Kevin McCartney): Okay. And on the fundamentals, Jag, could you address the
penetration of biotech traits in your portfolio
versus the broader U.S. cottonseed market and what you
think the opportunity might be there longer term?
Tom Jagodinski: Well, I think - I mean I'm - somewhere north
of 90% of our cotton variety sold right now contains one
or both of the Monsanto genes. The business plan that we
have in place and continue to have in place until this
transaction closes is to basically bring technology in
from others, Syngenta and DuPont namely, to put those
traits in our seed and shift - you know, shift away from
the Monsanto traits. If - assuming they're competitive and
- because we made more money on them, because the
fee-sharing is different.
But with respect to our trait penetration, we - you know,
90% plus is Monsanto's trait. We just launched the
Bollgard II/Roundup Ready Flex this year; that penetration
is modest at this particular time. But we're continuing to
put the new Monsanto traits in our most (delete) germ
plasm. So over time, you'll see a shift away from Bollgard
I and Bollgard - from - away from Bollgard I and Bollgard
II and away from Roundup Ready to Roundup Ready Flex.
(Kevin McCartney): Would you recall offhand how much is double-stacked?
Tom Jagodinski: Oh, essentially, I don't know the exact number but it's
way - it's well over half now.
(Kevin McCartney): Okay. Thank you very much.
Tom Jagodinski: Uh-huh.
Operator: Your next question comes from (Ryan Lombardi), (Dolphin)
Partners.
(Ryan Lombardi): Hi, good morning. It's (Ryan Lombardi) with
(Southsin). I guess just a follow-up on (Kevin's)
question. You know, there was a question on the Monsanto
call, you know, why now? This sort of - the interaction
between the new companies has been going on a long time,
there's a long history here and it seems like a tremendous
(doubt space). And their answer was, ask Delta and Pine.
And it seems like your answer to (Kevin's) question is,
ask Monsanto. I mean did you shop the company or it's a
cash deal? What was the process here?
Tom Jagodinski: Well, that will be - we will explain the
entire process in the Proxy Statement that we file. But,
you know, we have a lot - we have had a relationship with
Monsanto at least since 1989 on the technology front and
then the commercialization (reams) in '96 and we talked to
Monsanto continuously about a variety of matters.
And I think that, you know, the discussions - in 1998,
Monsanto, we had a transaction where they were going to
buy the company; the market was different at that
particular time, there was a rollup in the industry going
on and so forth.
But, you know, just - I think when the parties sat down
and started having discussions about, you know, how do we
rebuild our partnership and how do we work together which
is critical because we make a - Delta and Pine makes a
significant amount of its money on Monsanto traits and
this relationship is important among Monsanto as well, it
just made sense that - it made sense that, you know, that
they - it makes sense for them to own us also.
(Ryan Lombardi): So it sounds like this came out of the
negotiations and it wasn't - I mean despite the fact that
it was a cash deal, no one was - no one - no other company
was really offered a chance to buy it.
Tom Jagodinski: Well, this company is a publicly-traded
company; it's listed on the New York Stock Exchange. And
anybody who's likely to buy us knows exactly where we are
and how to get in touch with me. So, you know, we have
talked with over the last several years with various
strategic partners about their interest in either
acquiring a company or preferring to do technology
licenses. So, you know, I guess I don't buy into the
premise of your question that the - you know, nobody else
had an opportunity, they had - they've had an opportunity
since 2000.
(Ryan Lombardi): I'm just trying to get a feel for the process and I think
you've answered it. Thanks.
Operator: Your next question comes from (Bill) Young, Credit Suisse.
William Young: Hi, Jag. Congratulations on the deal.
Tom Jagodinski: Thanks, (Bill). I got a question for you.
William Young: Oh, hey, you're turning things around, huh?
Tom Jagodinski: Yeah. Do you think you could raise the target of your
stock - or target stock price now?
William Young: Gee, I guess I better. Gee, this is unbelievable.
And like you said, you guys have the second biggest EBITDA
multiple, at least certainly in my company coverage and,
you know, we could talk about the reasons for it or
against it. But I think you've got a really good price
here.
Now my question relates a little bit more to what you
talked about before. Under the current arrangements, which
you say are subject to renegotiation, are you guys
required to commercialize the trades from Syngenta and
DuPont assuming they have the property that you are
currently aware of?
Tom Jagodinski: I don't - there is not a requirement for renegotiation.
These contracts survive a change of control.
William Young: No, no. I don't mean that. Okay?
Tom Jagodinski: Okay, and I don't think we - we don't have an absolute
require to commercialize them in either case.
William Young: Yeah. What does that mean absolute?
Tom Jagodinski: Well we don't - I mean it's - look. We're
going to continue to work with them until the closing.
What Monsanto does with it after that is up to Monsanto
when they own the asset. They can continue to develop them
or they may not. It's just a matter of whatever choice
they make.
William Young: Okay. Now related to this thing here, what - how much of a
hurdle do you think Monsanto has? I mean if I'm
understanding, they said they would have to pay you up to
$600 million if they can't get DOJ approval? I
think that's what I heard this morning. Is that your
understanding?
Tom Jagodinski: In one - that is true in one circumstance. But
I would - there are - this is a complicated deal. It's
more complicated than a normal transaction. And when we
file the (ACAD) I encourage everybody to read the
agreement itself, but that is one thing.
We feel like we have a very strong contract. It's - and
let's face it. Monsanto is committed to getting this
transaction done and based on my view of how the process
unfolded. But, you know, we do have to have DOJ approval
and, you know, we're going to continue to run this
business in the ordinary course and comply with the
contract.
William Young: Now let's say another party came in, just make up a
number, and offered you $50 and you went ahead with that,
what would be the break up fee payable to Monsanto in a
case like that?
Tom Jagodinski: I don't want to discuss the specifics of it.
But in - there is a whole process in the contract that
provides that. Keep in mind there is a no shop provision
in there.
William Young: Right, I understand.
Tom Jagodinski: So we have to comply with it. But I believe in the case of
a...
Rick Green: Well we probably just want to wait for that contract to be
filed Jag. I mean as you...
Tom Jagodinski: It will be on there - it will be out there today shortly.
William Young: Okay, now let me ask you the same question I asked
Monsanto. If you go back to 1998, the penetration of GM
cotton wasn't all that large. Today it's over 90% and
while buyer has a little bit of market share in GM traits
in cotton, Monsanto has a preponderance of the technology
there. And that's a big change since the last time. What
makes you guys confident that you can get it through the
DOJ this time given that situation?
You know, they try to portray it as hey, Delta Pine has
lost market share since then, and this is a great
opportunity now. We won't have any problems from DOJ. But
I don't quite see it that way given that the bulk of all
the cotton traits are coming from Monsanto on the GM side.
Tom Jagodinski: Well you have two issues, the germ plasm share
and the trait share. I mean our germ plasm share has
declined since the - from the high 70s low 80s to just
over 50 now. The trait penetration, I mean you do have
Bayer that has Liberty Link cotton. And I suspect that
they are probably working on other herbicide tolerant
technologies, although I don't know for sure. You also
have Wide Strike that's in the market that it was
developed by Dow.
So there are other technologies that are being developed
by, you know, various well capitalized sophisticated
companies. And I think they got started later than
Monsanto and I think they're all playing catch up. And
that's why we were able to, you know, to execute the
licenses that we did with Syngenta and DuPont.
William Young: You know, well how much market share do you think
Liberty Link and Wide Strike have together if you look
over the acreage scene versus the Monsanto traits?
Tom Jagodinski: I don't know (Bill). Liberty is not as -
Liberty has I guess a more - the Liberty herbicide is more
narrowly focused in some areas. But, you know, I do think
that like Monsanto has talked about and like DuPont has
talked about or we've talked about, you know, we think
that the next better mousetrap in the herbicide space is
going to be a stack of two, you know, a dual system where
the plant is safened from two herbicides. So you'll have
other players. There are other players that I'm aware of
that are working in that space.
William Young: Okay, well just circle back. Would you be suspired if Dow
and Bayer together had more than 10% of the
acreage in GM traits today in cotton?
Tom Jagodinski: Well Bayer has 20 something percent or 30% of the - or 20%
to 30% market share germ plasm. I suspect most of
it is biotech. I don't know what their trait mix is. They
don't disclose it. They're not as transparent.
William Young: Well I don't think it's that big, but you might be right.
You might be right. But we'll see. I think it's an
interesting situation. We'll see how the DOJ reacts,
plus we have a different administration, you know, in
the White House right now.
Tom Jagodinski: Right.
William Young: Okay, well look. Thanks for answering my questions.
Congratulations again.
Tom Jagodinski: Thanks a lot.
Operator: Your next question comes from Diane Geissler, Merrill
Lynch.
Tom Jagodinski: Hi Diane.
Diane Geissler: Good morning Jag and Rick.
Rick Green: Good morning.
Diane Geissler: Congratulations.
Tom Jagodinski: Thank you.
Diane Geissler: Most of my question shave been answered but I
just - a quick question on the $600 million and maybe I
was hearing it wrong. I just want a clarification on it.
They indicated that is the worst case scenario. Can I - is
that - obviously I think the worst case scenario would be
that the DOJ turns them down and this is a, you know, the
deal breaks apart. Is that how I should read that?
Tom Jagodinski: There are multiple provisions around - to cover a breech.
And I assume that either Monsanto has filed their
AK or they disclose that on their call. Because I don't
think I said anything about the number. Or either
that or you have very good intelligence. But...
Diane Geissler: No, they said it on their call.
Tom Jagodinski: Okay, well there is a provision in there that
if they can't - under certain - they have an obligation to
close this transaction. The $600 million I believe is a
remedy if they cannot close it. But I'm not sure what - I
don't recall exactly what their circumstances are.
Diane Geissler: Will that be in your filing then that you put out?
Tom Jagodinski: It will be. We'll file the agreement. We will file the
agreement.
Diane Geissler: Okay. All right. Well then I will check there for the
details. That's all I had. Thank you.
Tom Jagodinski: Mm-hmm
Operator: Your next question comes from (Jed Goldfarb)
(unintelligible) Capital.
(Jed Goldfarb): Hey Jag, congratulations:
Tom Jagodinski: Thank you.
(Jed Goldfarb): Most of my questions were answered as well.
Just one on the break up fee. If the proposed transaction
were to be blocked by the Department of Justice and
Monsanto had to pay the break up fee, is that - would the
merger agreement require you to still dismiss a lawsuit?
Rick Green: I think we need to wait for that.
Tom Jagodinski: We need to wait for the agreement. Those are complicated
provisions. Because depending on the reason that
the deal doesn't close there are different remedies. Okay?
(Jed Goldfarb): Got you. And, you know, you answered the
question before whether you know, you had shopped the
company since Thursday. I mean has DuPont or Syngenta
approached you guys within the last, you know, 12 months?
I mean has litigation been a barrier to negotiations with
these guys?
Tom Jagodinski: Well we wouldn't comment on something like
that. But I mean we talked - we have relationships with
Syngenta and DuPont and others that we talk to basically
in some cases monthly, not necessarily about strategic
things. But I couldn't comment about anything about in the
M&A space.
(Jed Goldfarb): Thanks very much, congrats.
Tom Jagodinski: Thanks a lot.
Operator: Your next question comes from (Matt Sate), First Capital
Alliance.
(Matt Sate): The prior question has already been answered. Thank you.
Operator: Your next question comes from (Patrick Rowe), Sterling
Capital.
(Patrick Rowe): Yeah, hello Jag.
Tom Jagodinski: (Patrick), how are you?
(Patrick Rowe): I'm good, good. It was a nice way to start the day this
morning. Thank you for that.
Tom Jagodinski: You're welcome. I enjoyed it myself.
(Patrick Rowe): You had a little bit more work to do over the
weekend. Well, my questions have been answered. I just
wanted to offer my congratulations on a long week and a
long few years of work for you and your team culminating
in this -- a job well done.
Tom Jagodinski: Thanks a lot.
Operator: Your next question comes from Peter Butler, Glenhill
Investments.
Peter Butler: Yeah hey. I - Jag, maybe you could give us the benefit of
how you see things in the ag chemical game. How do
you see this end game concluding in ag chemicals? There is
three major players with seeds and there is three
without. And how do you - what do you see next?
Tom Jagodinski: Well there is, you know, the chemical, I mean
the ag chem sector had a bad year. I mean in - when that
happens you have uncertainty. And you're right, you know
we've always said there are more trait providers than
there are cotton seed companies. And we've used that to
our advantage.
I don't know what, you know, I don't follow the chemical
side very well. But you have people like Bayer, Dow,
DuPont Syngenta, and even BASF is working in the biotech
arena and as - is obviously as its Monsanto. So I don't
know what will happen.
Peter Butler: Maybe could Rick - Mr. Green comment on what can you do
with Monsanto's money and organization to really
accelerate what you're doing outside the United States?
Rick Green: Well obviously, you know, as one of the, you know,
as an independent public company we've had a small
presence outside the US for a number of years. And, you
know, with some of the moves that we've made over the last
six to eight months we obviously have been accelerating
our pace of expanding our international business. But you
know, we're a relatively small company compared to the
multinational chemical players that you referred to
earlier.
So Monsanto does have a large presence outside the US.
Likewise some of the partners that we have today have
large presence outside the US. So you know, regardless we
look forward to ramping up our presence outside the US and
getting our genetics on as many acres as we can. So the
outlook is positive in any regard.
Peter Butler: But it sort of speaks to the question I was
raising before that the - obviously with the foreign
cotton acres dwarfing what we have here in the US if you
had a really ramped up aggressive program you could more
than replicate the success of Delta in the US. And the
better the, you know, the better job you do there the
cheaper the price becomes for Delta, the apparent price.
Rick Green: Well I mean that's, you know, that's obviously the
strategy. I mean we talked for quite some time about the
number of acres outside the US being around 70 million and
the acres inside the US being 14 to 15 million. You know,
the hurdle has been regulatory approvals or transgenes.
And I think, you know, we've seen a lot of barriers come
down in recent years about that. So for instance, in
Brazil we'll be launching Bogard in our fall their spring
here in s few months.
So I mean there are a great deal of opportunities out
there. And you know, regardless of whether we're
independent or owned by Monsanto in the future, we do
think there is a great deal of optimism about the
international business.
Peter Butler: Again, good luck to you guys.
Tom Jagodinski: Thanks a lot Peter. (Wanda), we've got time for a couple
more and then we need to run.
Operator: Okay. Your net question comes from (Aaron Levinoff) at the
Big Partners.
(Aaron Levinoff): Congratulations. My question in terms of anti-trust
divestitures, I notice that Stoneville always seems to
be divested. Are there any other investors contemplated
such as Emergent Genetics? And likewise is related
intellectual property divestitures required as well?
Tom Jagodinski: I think those are Monsanto assets and I would
add I can't answer that because I don't know what their
plans are. I think you'd be best asking them that, because
if I answered I would be speculating.
(Aaron Levinoff): So there is nothing else that you're aware of in terms of
within the agreement itself?
Tom Jagodinski: Well the only thing that I'm aware of in the agreement is
the Stoneville situation.
(Aaron Levinoff): Thank you very much.
Operator: Your next question comes from Marybeth Connolly, Goldman
Sachs.
Marybeth Connolly: Thank you. Most of my questions have been
answered but I just wanted to ask a quick question on
valuation relative to the '98 deal. Monsanto in their call
this morning mentioned a mid-teens EBITDA multiple on the
- in the $1.5 billion price. And if I look back, it looks
like the '98 price was $1.8 or $1.9 billion. I just wanted
to find out what the corresponding EBITDA multiple was.
Tom Jagodinski: The multiples in '98 were even further off -
way off the chart. If you recall there was a roll up in
the industry and Monsanto was chasing several companies,
Dow was after Mycogen, DuPont bought Pioneer. And I think,
you know, our stock was actually traded as high as $54 a
share before the '98 deal was announced. But the PE and
the EBITDA multiples were significantly higher then than
they were today. And it was on speculation of a roll up
and scarcity value then. And, you know, obviously the
market has settled since then.
Marybeth Connolly: Okay, so you think it has more to do with the market
dynamics than the erosion of market share?
Tom Jagodinski: Yeah, definitely.
Mary Beth Connolly: Thank you.
Operator: Ladies and gentlemen we have reached the end of the
allotted time for questions and answers. Mr. Jagodinski,
are there any closing remarks?
Tom Jagodinski: Yes, well anyway, thanks everyone. I'm glad
that we were able to get this transaction put together. I
think it's a excellent opportunity for our shareholders
and it's a good opportunity for Monsanto. And until the
transaction closes we will continue to run this business
as we see fit and to do what we can to maximize earnings
and the value of the company.
Thanks again.
Operator: Thank you. This concludes today's conference call. You may
now disconnect.
END
In connection with Monsanto Company's ("Monsanto") proposed acquisition of Delta
and Pine Land Company ("D&PL") pursuant to the terms of an Agreement and Plan of
Merger by and among D&PL, Monsanto, and a wholly-owned subsidiary of Monsanto,
D&PL will file a proxy statement with the Securities and Exchange Commission
(the "SEC"). Investors are urged to read the proxy statement (including all
amendments and supplements to it) because it will contain important information.
Investors may obtain free copies of the proxy statement when it becomes
available, as well as other filings containing information about D&PL, without
charge, at the SEC's Internet site (www.sec.gov). These documents may also be
obtained for free from D&PL's Investor Relations web site (www.deltaandpine.com)
or by directing a request to D&PL at: Delta and Pine Land Company, Corporate
Offices, P.O. Box 157, Scott, MS 38772.
D&PL and its respective directors and executive officers and other members of
management and employees are potential participants in the solicitation of
proxies from D&PL's stockholders in respect of the proposed transaction.
Information regarding D&PL's directors and executive officers is available in
D&PL's proxy statement for its 2006 annual meeting of stockholders, filed with
the SEC on November 29, 2005. Additional information regarding the interests of
such potential participants in the proposed transaction will be included in the
proxy statement to be filed with the SEC in connection with the proposed
transaction.
This written communication contains forward-looking statements that involve
risks and uncertainties concerning Monsanto's proposed acquisition of D&PL,
D&PL's expected financial performance, as well as D&PL's strategic and
operational plans. Actual events or results may differ materially from those
described in this written communication due to a number of risks and
uncertainties. The potential risks and uncertainties include, among others, the
possibility that the transaction will not close or that the closing may be
delayed; the reaction of customers of D&PL to the transaction and general
economic conditions. In addition, please refer to the documents that D&PL files
with the SEC on Forms 10-K, 10-Q and 8-K. The filings by D&PL identifies and
addresses other important factors that could cause its financial and operational
results to differ materially from those contained in the forward-looking
statements set forth in this written communication. D&PL is under no duty to
update any of the forward-looking statements after the date of this press
release to conform to actual results.