Monsanto to sell biogums business; shareholders to vote on merger

ST. LOUIS (AP) -- Monsanto Co. on Tuesday continued to clear the way for its merger with Pharmacia & Upjohn Inc., announcing the<br>sale of another division and setting a date for a shareholders meeting

Tuesday, February 22nd 2000, 12:00 am

By: News On 6

ST. LOUIS (AP) -- Monsanto Co. on Tuesday continued to clear the way for its merger with Pharmacia & Upjohn Inc., announcing the
sale of another division and setting a date for a shareholders meeting on the merger.

The St. Louis-based company announced it is selling its Kelco biogums business to a joint venture between Hercules Inc. and Lehman Brothers Merchant Banking Partners II. The sale price is $685 million cash. Kelco's operations include a facility in Okmulgee, Okla.

Meanwhile, shareholders for both Monsanto and Pharmacia & Upjohn Inc. will hold special meetings March 23 to vote on the proposed
merger of the two companies. Monsanto shareholders will meet in Skokie, Ill., while Pharmacia & Upjohn shareholders will gather in Wilmington, Del.

The two companies agreed to a merger in December, creating a company that would be known as Pharmacia Corp. The merger is
expected to close in the first half of this year. Headquarters for the new company would be in Peapack, N.J. Its agricultural division
would be based in St. Louis and retain the Monsanto name.

Biogums are used mainly to improve the texture and processing of foods. Monsanto's main biogums operations are in San Diego;
Chicago; Okmulgee and Knowsley, United Kingdom.

"As with the other businesses we've sold or announced our intent to divest, the biogums business is a proven performer, but is not a strategic fit with the direction we've chosen for
Monsanto," said Gary Crittenden, the company's chief financial officer.

Monsanto makes a wide range of products, including the arthritis drug Celebrex, Roundup herbicide and other agricultural products.

Since last summer, Monsanto has been selling businesses that are not core to pharmaceuticals and agriculture.

Monsanto sold its algins business on Oct. 15, and announced earlier this month it had reached agreement to sell its tabletop
sweetener business.

Together, the artificial sweetener, algins and biogum businesses had sales of about $1 billion annually.