Monsanto Co. on Tuesday declined a $62 billion takeover offer from Germany's Bayer. However, the biotech seed giant said that it is open to further negotiations, which Bayer sees as an encouraging response.

Monsanto believes Bayer's offer was "financially inadequate," with Hugh Grant, Monsanto's chief executive, saying Bayer undervalued the company. He also voiced concern about whether the deal will be approved by regulators.

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Monsanto's decision to turn down the offer was reportedly unanimous, an insider told Bloomberg.

Following the news, both companies' market value climbed to 3.1 percent to $109.30 for Monsanto late trading in New York and 3.2 percent to $97.12 for Bayer in Frankfurt.

Bayer said that its bid marks an "extraordinary opportunity to create a global agriculture leader."

Bayer proposed to pay $122 per share in cash, making it supposedly the biggest all-cash offer, according to Reuters.

Monsanto, on the other hand, did not divulge how much it wanted. However, experts believe Bayer needs to shell out more to come with an agreement.

"We believe it is unlikely that the deal gets done at $122 and still believe $135 is a more likely price," analysts at JP Morgan wrote. An analyst from New York's Stanford C. Bernstein & Co. noted on Tuesday that an offer less than $135 per share would be "challenging for Monsanto agree to."

Acquiring Monsanto will make Bayer the biggest seed supplier and leader of crop biotechnology. Monsanto's genetically modified seed is responsible for a majority of the corn and soybeans plantation across the United States. The company is also selling to foreign clients from in Latin America and India.

TagsMonsanto, Bayer, biotech seed, genetically modified seed