China National Chemical Corporation to acquire Syngenta AG
According to the report published by
TechSci Research, “Iran Fertilizers Market Forecast and Opportunities, 2020”,
the demand for fertilizers in Iran is expected to grow at a CAGR of 3.5% during
2015 – 2020 on account of increasing demand to meet self-sufficiency in meeting
the demand for production of staple food crops. The market is dominated by
nitrogen fertilizers with urea and ammonium nitrate being the largest consumed
fertilizers.
Syngenta,
a Switzerland based agricultural chemicals company, has formally agreed to the
takeover proposition offered by the Chinese state owned chemical giant, that is
China National Chemical Corporation (ChemChina). ChemChina offered USD43
billion for the acquisition of Syngenta and USD465 per ordinary share in cash in
addition to a special dividend of 5 Swiss francs (USD4.97) to be paid prior to
deal’s closing by the end of 2016. The present management of the Syngenta would
continue to run the company and the headquarters would continue to be located
in Switzerland. The offer is equivalent to SF480/Syngenta share. Moreover,
Syngenta shareholders would also receive the anticipated ordinary dividend of
SF11 in May.
Around 75% of Syngenta’s revenue is
generated through sales of chemical pesticides, while majority of the remaining
income is generated by the seeds business. The deal is the latest in the
consolidation of the global seed and pesticide industry.
TechSci Research depicts that this
acquisition would enable ChemChina to expand its position in global
agricultural technology field. This deal would aid China to meet the growing
demand for agrochemicals, including fertilizers and pesticides, to meet the food
security concerns in the country.