Syngenta, a Swiss-based agriculture company, has announced that Beijing-based ChemChina has offered to acquire the company at $465 per ordinary share plus a special dividend of CHF 5 to be paid conditional upon and prior to closing. The offer is equivalent to $473 (CHF 480) per share.
In August 2015, Syngenta rejected a $47 billion takeover offer from Monsanto, saying the offer undervalued the Swiss firm and did not fully take into account regulatory risks.
Syngenta’s board of directors considers that the ChemChina proposed transaction respects the interests of all stakeholders and is unanimously recommending the offer to shareholders. There is committed financing for the deal and a strong commitment to pursue regulatory clearances. A Swiss and U.S. tender offer will commence in the coming weeks and the transaction is expected to conclude by the end of the year.
Syngenta’s existing management will continue to run the company. After closing, a 10-member board of directors will be chaired by Ren Jianxin, chairman of ChemChina, and will include four of the existing Syngenta board members. ChemChina is committed to maintaining the highest governance standards with a view to an IPO of the business in the years to come.
“Syngenta is the world leader in crop protection having significantly increased its global market share over the last 10 years,” said John Ramsay, chief executive officer. “This deal will enable us to maintain and expand this position, while at the same time significantly increasing the potential for our seeds business. It will ensure continuing choice for growers and ongoing R&D investment across technology platforms and across crops. Our commitment to cost and capital efficiency will remain unchanged.”
The transaction will enable further expansion of Syngenta’s presence in emerging markets and notably in China. In addition to its array of modern chemistry, Syngenta will contribute its experience and know-how in promoting the highest environmental standards and in nurturing thriving rural communities. These objectives are reflected in the commitments contained in The Good Growth Plan, which have been explicitly endorsed by ChemChina and which—together with the Syngenta Foundation for Sustainable Agriculture—will continue to form an integral part of the company’s strategy.
