6 Things To Know About The ChemChina-Syngenta Deal

6 Things To Know About The ChemChina-Syngenta Deal

After months of rumors and speculation, Syngenta has announced that ChemChina has offered to acquire the Swiss-based company.

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“In making this offer, ChemChina is recognizing the quality and potential of Syngenta’s business,” said Michel Demaré, Chairman of Syngenta. “This includes industry-leading R&D and manufacturing and the quality of our people worldwide.”

Ren Jianxin, Chairman of ChemChina, added: “The discussions between our two companies have been friendly, constructive, and cooperative, and we are delighted that this collaboration has led to the agreement announced today. 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.”

Here are six things to know about the deal:

  1. Deal value. ChemChina’s cash offer to acquire Syngenta is valued over US$43 billion. This includes US$465 per share plus special dividend of CHF 5. The offer is equivalent to a Swiss france value of CHF 480 per share. Syngenta shareholders will in addition receive the proposed ordinary dividend of CHF 11 in May 2016.
  2. Board of Directors supports deal. The Board of Directors of Syngenta considers that the proposed transaction respects the interests of all stakeholders and is unanimously recommending the offer to shareholders. There is committed financing for the deal and a strong commitment to pursue regulatory clearances.
  3. Expected closing.  A Swiss and U.S. tender offer will commence in the coming weeks and the transaction is expected to conclude by the end of the year.
  4. Syngenta management will continue to run the company. After closing, a 10-member Board of Directors will be chaired by Jianxin, and will include four of the existing Syngenta Board members. ChemChina is committed to maintaining the highest governance standards with a view to an IPO of the business in the years to come.
  5. Syngenta name and headquarters remain the same. Syngenta will remain Syngenta and will continue to be headquartered in Switzerland, “reflecting this country’s attractiveness as a corporate location,” Demaré said.
  6. Expand emerging markets. The transaction will enable further expansion of Syngenta’s presence in emerging markets and notably in China. In addition to its array of modern chemistry, Syngenta will contribute its experience and know-how in promoting the highest environmental standards and in nurturing thriving rural communities. These objectives are reflected in the commitments contained in The Good Growth Plan, which have been explicitly endorsed by ChemChina and which — together with the Syngenta Foundation for Sustainable Agriculture — will continue to form an integral part of the company’s strategy.