ChemChina to clear EU review of $43B Syngenta deal
February 03, 2017
The European Commission will approve the $43 billion acquisition of Swiss agricultural giant Syngenta (SIX: SYNN, NYSE: SYT) by ChemChina after a review process that began its second phase in October, according to Reuters. At the heart of the scrutiny has been Israeli crop-protection producer Adama, a subsidiary of ChemChina, which has a portfolio that overlaps with some of Syngenta's offerings, including herbicides, insecticides, fungicides and plant growth regulators.
In particular, the EU has been concerned that, as the largest provider of generic versions of these products to European markets, Adama would be too important to lose as a competitor with Syngenta, with a merger resulting in negative impacts on price and choices for farmers. However, ChemChina has promised to divest some of its holdings to push the deal through the review process. The deal has already received US approval, and the EU has until April 12 to give an official ruling. Syngenta stock gained marginally in the wake of the report.