March 9, 2010

Syngenta to increase share buyback programme

Swiss agribusiness Syngenta has opened the door to increasing its buyback programme, while dampening speculation the company will buy as much as 9.5 million shares.

The group is prepared to purchase at least 10% of its stock by the end of 2012. Buybacks at that level would be worth about CHF2.9 billion (US$2.7 billion) at current market prices. Syngenta guided last month to buybacks of about CHF200 million (US$186 million) this year.

This implies that guidance given at the 2009 results last month for a modest 2010 buyback has been increased substantially, and the news has reduced the possibility that Syngenta will execute a major strategic and potentially dilutive acquisition in the foreseeable future, according to analysts.

Syngenta spent about US$2 billion on buybacks between 2004 and 2008, before suspending them last year amid the global recession and as a potential sale of Dow Chemical's agriculture division loomed.