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April 6, 2017

 

US conditionally approves ChemChina takeover of Syngenta

 

 

The US has conditionally approved the proposed $43-billion acquisition of Swiss agribusiness giant Syngenta by the Chinese state-owned conglomerate ChemChina.

 

The Federal Trade Commission (FTC) said the approval hinges on the condition ChemChina, also known as China National Chemical Corp., sell some businesses to satisfy anti-monopoly objections.

 

The FTC had filed a complaint that claimed the merger, as originally proposed, would likely cause significant competitive harm in the US markets for three pesticides: herbicide paraquat, insecticide abamectin and the fungicide chlorothalonil.

 

The complaint alleged that without the proposed divestiture, the merger would eliminate the direct competition that exists today between ChemChina generics subsidiary ADAMA Agricultural Solutions Ltd. and Syngenta's branded products.

 

ChemChina to sell pesticide businesses

 

The merger, it added, would also increase the likelihood that US customers buying paraquat, abamectin and chlorothalonil would be forced to pay higher prices or accept reduced service for these products.

 

ChemChina has agreed to sell businesses that make the said herbicide, insecticide and fungicide for which combined market shares with Syngenta would cause "significant competitive harm," the FTC said in a statement Tuesday, April 4.

 

ADAMA, the largest supplier of generic crop protection products in Europe, has also agreed to sell businesses in the US that produce the herbicide paraquat, the insecticide abamectin and the fungicide chlorothalonil to American Vanguard Corp. and its affiliate Amvac Chemical Corp.

 

Earlier last year, European regulators approved the purchase deal between ChemChina and Syngenta, which is one of the main global seeds and crop-protection companies. 

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