Syngenta says regulatory talks over takeover ‘constructive’
Company has agreed to be taken over by China National Chemical for $43 billion
Swiss agrochemicals maker Syngenta: China’s state-owned ChemChina hopes to have regulatory clearance to complete the takeover deal by the end of the year. Photograph: Arnd Wiegmann/Reuters
Syngenta, which has agreed to be taken over by China National Chemical for $43 billion (€39bn), said talks with regulatory authorities to win approval for the deal have been constructive and the Swiss company is confident the transaction can be closed on time.
Talks with all regulatory authorities are ongoing and the goal remains to complete the deal by year end, the Basel-based agrochemical company said in a statement on Friday.
Syngenta reported earnings before interest, taxes, depreciation and amortisation of $1.77 billion, lower than an average predicted profit of $1.91 billion by analysts.
Chief executive officer Erik Fyrwald is seven weeks into the role with the dual task of steering Syngenta through its takeover by the state-owned company and streamlining a cost base to adapt to increased competition.
Its Chinese parent-to-be will provide a buffer at a time of weak grain prices, a lack of credit among farmers in Latin America, and a relatively benign year for pests.
ChemChina is seeking regulatory approval for the purchase that will make it the world’s largest supplier of pesticides and other crop-care chemicals, albeit temporarily.
Dow Chemical’s merger with DuPont and Bayer’s possible purchase of Monsanto will reorder the top rankings as the top six suppliers jostle for market share and financial power to drive research and new product releases.
For Syngenta, investors are focused on the process of winning approval from the Committee on Foreign Investment in the US in a presidential election year.