German multinational seed and crop protection company Bayer has sweetened its offer for Monsanto Company (NYSE:MON) to US$65 billion, after the U.S. entity rejected other bids earlier this year. 

Bayer said it was in 'advanced negotiations' with Monsanto concerning a proposed transaction.

While key terms and conditions have not yet been agreed, the German company said it was prepared to pay US$127.50 per share.

Its initial offer of US$122 per share in May was rejected, with Monsanto labeling it 'financially inadequate'. The offer was equivalent to around US$62 billion.

Bayer raised its offer by US$3 per share in July but it was again rejected.

Monsanto confirmed in a statement that it had been holding talks with Bayer and that it had received an updated cash offer.

"Monsanto is continuing these conversations as it evaluates this proposal, as well as proposals from other parties and other strategic alternatives to enable its Board of Directors to determine if a transaction in the best interests of its shareowners can be realized," the company said, adding it had no further comment at this time.

In a video on the company's website, Bayer CEO had discussed the proposed combination earlier in the year, describing it as an ‘extraordinary opportunity to create a global leader in the agricultural industry.’

"Monsanto is a perfect match to our agricultural business, we would combine complementary skills with minimal geographic overlap," he said at the time.

"We at Bayer have a leading position in crop protection and Monsanto is extremely strong in seeds and trades, so jointly we will be an innovation powerhouse to address farmers’ future needs.

"This is particularly exciting in advancing digital farming. The proposed acquisition of Monsanto is strategically compelling and completely logical."

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