The markets are buzzing merger talk after news broke late last week that Bayer, the German Drug behemoth, has launched a unsolicited £43 billion takeover bid for Monsanto, the company famous (or infamous, regarding one’s agricultural viewpoint) for its genetically modified crops.

The merger is by far the largest ever acquisition attempt by a German company; German businesses are not known for adventurous acquisitions of this magnitude. Indeed, there are signs that Bayer’s offer has ruffled investor feathers. The stock fell after last week’s announcement; at the time of writing, Bayer stock was down by 3.5% on the day. It’s a huge step for Bayer to take, magnified further by the fact that Werner Baumann, CEO of Bayer, has been in his position for less than a month.

Announcing such a deal almost before the ink is dry on your employment contract is a risky move, and Baumann may well have betrayed his nervousness on a Monday morning conference call, when he attributed the fall in stock price last week to ‘an uneducated reaction in the media and press’, a comment which is unlikely to endear him to financial reporters.

It appears that Bayer have gone in strongly from the beginning; instead of lowballing the offer and negotiating upwards, they’ve come in hard and fast by immediately going for a higher offer. Last week it was announced that Bayer had made an offer of $122 on May 10th, which was a 37% premium on Monsanto’s May 9th closing price of $89.03. Monsanto’s share price soared when news of the potential merger broke last week, however, and the stock opened up by 7% on Monday. It’s currently trading at around the 107.5 mark, not that far off from Bayer’s suggested purchase price.

Despite the public perception, Bayer’s business does extend beyond pharmaceuticals and flagship pharmaceutical products such as Aspirin. One of the reasons that proponents of the deal can argue that it makes sense is because the company does has a farm business, which among other things, produces weedkiller and pesticides. Monsanto, of course, is well known for its pesticides (the company is global enemy number one for many in the Green movement).

With other companies in the chemical sector looking to join forces (most notably Dow and DuPont, who last year announced their intention to merge) Monsanto might well be giving serious consideration to this deal. Dow and DuPont’s planned merger has not yet gone ahead, but Bayer-Monsanto would dwarf it.

However, concerned investors are now likely to be giving some thought as to Bayer’s future reputation. The company has always been best known for its pharmaceutical business – if this takeover goes ahead, almost 50% of the combined business will be agriculture focussed, most likely (given Bayer’s behaviour in the wake of previous purchases) all consolidated solely under the Bayer name. Will Bayer’s reputation take a hit as a result? We will see. Even if Monsanto agree to the offer (or a subsequent one) there’s still a long road to travel before any such deal would be ratified. In the meantime, however, investors are waiting for Monsanto’s response to see whether this will be a relatively smooth agreement or a protracted struggle.