Ren, 58, has been dubbed the “undisputed king” of mergers and acquisitions in China’s chemical industry by the country’s state-owned media. The price represents a 22% premium to Syngenta’s closing price on Tuesday.
Advertisement
“Only around 10 per cent of Chinese farmland is efficient”.
“Most important at the end is that Syngenta remains Syngenta, just with a different owner”. “This is a government attempting to address a real problem”.
Years of intensive farming combined with overuse of chemicals has degraded land and poisoned water supplies, leaving China increasingly vulnerable to crop shortages.
Syngenta is expected to report revenues of $13.5 billion in their earnings report, an 11% decline from previous year, and 75% of those earnings come from its seed and crop segments. The lender was ranked ninth on merger advisory in Asia Pacific a year ago, compared with 19th globally, according to data compiled by Bloomberg. That’s about 20 per cent higher than Syngenta’s last close of 392.30 Swiss francs (S$552.26) on Feb 2.
After Syngenta rebuffed a takeover bid from Monsanto a year ago, Demare said that his company was thinking of making an acquisition, merging with a competitor or selling up. China is on the hunt for strategic resource deals to provide for the long-term security of its huge population.
Syngenta chief executive John Ramsay told Reuters on Wednesday he did not see major challenges to the deal winning regulatory approval.
“There is very little anti-trust risk”, Mr. Ramsay said.
“One of the most important elements of this offer is that Syngenta remains Syngenta”, Pisk said.
Syngenta had been under pressure to offer rewards to shareholders after turning down a big offer from USA rival Monsanto in 2015.
ChemChina, short for China National Chemical Corp., has agreed to pay about $3 billion in fees to Syngenta should it fail to meet all requirements for the deal.
“We will continue to work alongside the management and employees of Syngenta to maintain the company’s leading competitive edge in the global agricultural technology field”.
The chairman of Syngenta has denied that the proposed $43bn (£30bn) takeover by ChemChina amounts to a Chinese nationalisation of the Swiss agribusiness giant.
Advertisement
As well as domination of the Chinese market, Syngenta will provide global access to farmers from Brazil to the UK. ChemChina’s latest purchase follows other Chinese overseas transactions this year including Haier Group Corp’s (海爾) US$5.4 billion purchase of General Electric Co’s home-appliance business to Dalian Wanda Group Co’s (萬達集團) deal to buy control of Legendary Entertainment.
