Monsanto lost out to ChemChina in its bid to buy seeds and pesticides firm Syngenta last year.
State-owned ChemChina’s deal for Syngenta and a merger between DuPont and Dow Chemical has dramatically changed the agricultural landscape in a matter of months.
Monsanto share’s were up 17.7 percent at $106.30 in premarket trading on Thursday.
Bayer has discussed how to finance a deal including potential asset sales, Bloomberg reported.
No final decision has been made and Bayer could decide against a bid or pursue other transactions with Monsanto, including joint ventures or asset sales, Bloomberg quoted the people as saying.
Monsanto, which had a market value of about $40 billion as of Wednesday close, declined to comment.
Bayer also declined to comment.
Street Insider, citing sources, reported late on Wednesday that Germany’s BASF SE was considering a bid for Monsanto.