In reports that have been confirmed by the company in a statement released on Monday, Bayer has offered $122 per share for Monsanto in an all-cash deal that values the U.S. company at $62 billion.

The bid was at a 37 percent premium to Monsanto’s May 9 closing share price of $89.03, the Bayer statement said.

News reports about the talks for a deal between the US agri-chemical maker and the German drugs company had been made public on May 19.

In the first full year after the deal closed, the German company expects the deal to provide its shareholders with mid-single-digit percentage accretion to core earnings per share, Bayer said. The company further clarified that it expects that a double-digit percentage would be reached afterwards following the first year of the deal.

“What we are seeing is that the corporates in the U.S. have been leveraging steadily over the last two or three years… the rest of the world is only catching up to the U.S. in terms of beginning to leverage their balance sheets so I would expect a lot more M&A activity outside of the U.S.,” Ashok Shah, director of asset management company London & Capital, told CNBC on Monday.

Three years after the deal closed, the expected annual earnings contributions from synergies to be work would be about $1.5 billion, Bayer said while mentioning its future expectations from the deal.

“Most sectors got through these kinds of phases when you have a lot of reorganization within the sector and that is a lot to do with the maturity of the product profile of the stuff that’s being sold to the customer,” said Shah.

“Is the new phase going to be more destructive for the existing production and the existing processes and if the answer is yes, it means that the new processes are going to take over the market shares very, very quickly,” he added.

With an equity portion slated to represent about 25 per cent of the deal’s value, the German company said it would finance the deal with a combination of debt and equity. Bayer confirmed that the rights offerings would be the primary mode of raising the cash required for the deal.

The Bayer communiqué further mentioned that the Bank of America, Merrill Lynch and Credit Suisse were financing the deal.

This deal between the German drugs and chemicals group and the U.S. seeds company would create the world’s biggest agricultural supplier.

Creating a an investor backlash in which one of the German company’s major shareholders called the move “arrogant empire-building” last week, Monsanto had disclosed that Bayer had made an unsolicited takeover offer for the group.

With a reference to Bayer’s push to combine the development and sale of seeds and crop protection chemicals, the company said in the statement that additional future benefits were to be gained from integrated offerings.

“We have long respected Monsanto’s business and share their vision to create an integrated business that we believe is capable of generating substantial value for both companies’ shareholders,” Bayer Chief Executive Werner Baumann said in the statement.

(Adapted from CNBC and Reuters)