Linked In
News In
Linked In

You are viewing your 1 complimentary article.

Register now to receive full access.

Already registered?

Login | Join us now

Monsanto still eyeing Syngenta. Bayer plays hard to get

Twitter Linkedin eCard

Monsanto is considering fresh acquisitions in the agrichemicals sector, and still has its eye on Syngenta, executives told investors.

Meanwhile, Syngenta's chairman, Michel Demare, which earlier this year rebuffed a $45bn takeover bid from Monsanto, a said that he was "convinced" that the next six months would bring a shake-up of the industry.

Monsanto president Brett Begemann said on Tuesday that, even after Syngenta's rejection - which was ill received by many of the Swiss group's investors - "we've had conversations inside" about a further pursuit of the company, or indeed and other agribusinesses.

Mr Begemann said Monsanto is in the market for agrichemical acquisitions in particular, potentially for business spun-out as a result of industry mergers.

Hugh Grant, the Monsanto chief executive, said that the group, the world's largest seed company, was "best placed to be a leading consolidator or a leading partner in an industry that is changing".

Sector shake-up

The environment in the agricultural chemical sector has grown increasingly febrile, against a background of low grain prices and strained farmer budgets, as discussion around takeover bids proliferates.

Agricultural input companies are smarting from reduced farmer incomes, with US operators particularly hard hit, due to the strengthening dollar which has eaten into foreign currency-denominated revenues.

And Syngenta in particular has found itself the centre of takeover attention.

Chinese offers rebuffed

As well as the Monsanto offer, the third such bid this year, the Swiss agribusiness last week rejected at $42bn offer from the Chinese state-owned China National Chemical Corp.

German chemical group BASF is reported to have sought financing for a Syngenta takeover earlier this year.

And the Wall Street Journal has carried reports that Syngenta was in takeover discussions with Dupont.

Syngenta's chief executive Mike Mack stepped down last month, in the wake of the rejected Monsanto bid.

The rebuff, which was down to the Syngenta board rather than Mr Mack, sent the company's shares sharply downward.

'Extremely active'

In an interview with the Financial Times on Wednesday, Syngenta chairman Michel Demare said that merger and acquisition conversations in the industry were "extremely active".

"This is the result of the Monsanto approach for Syngenta, which for sure has shaken the whole industry ... It has created the huge activity in which everyone is speaking to each other," Mr Demare said.

"We are all convinced that [the sector] will look quite different in six months."

'Everyone is talking to everyone'

Meanwhile, DuPont has also been in talks with Dow Chemicals, over the possibility of acquiring the group's seed and ag-chemical division.

"Everyone is talking to everyone," the boss of Dow Chemical told investors last month,

Last week, Kerry Preete, Monsanto's vice-president of global strategy, told investors that consolidation in the sector was "inevitable," citing economies of scale in research and development.

But on Wednesday the German drugs and pesticides maker Bayer restated its commitment to keep hold of its crop chemicals business amid the feeding frenzy.

A Bayer spokesman said that the group's CropScience unit was an "integral part" of the group.

By William Clarke

Twitter Linkedin eCard
Related Stories

Will protein prices fight back against fat in dairy markets?

Prices of fats remain elevated against protein values in dairy - at a time when the opposite is true in markets for oilseed products

World phosphate, potash shipments to grow in 2018, helped by Chinese needs

Mosaic forecasts further demand expansion, as it heralds a "transformational year" for its own fortunes, after a 2017 marred by a one-time tax charge

Deere lifts sales hopes - even as it unveils biggest loss in 25 years

The maker of John Deere tractors flags "strengthening" market conditions, but swallows a huge writedown prompted by US tax retorms

Plant Impact agrees takeover by Croda, after failure of Bayer contract

The crop enhancement group, floored by the failure of a supply deal with Bayer, agrees a takeover by a maker of chemicals from anti-wrinkle creams to floor coatings
Home | About | RSS | Commodities | Companies | Markets | Legal disclaimer | Privacy policy | Contact

Our Brands: Comtell | Feedinfo | FGInsight

© 2017 and Agrimoney are trademarks of Agrimoney Ltd
Agrimoney is part of AgriBriefing Ltd
Agrimoney Ltd is registered in England & Wales. Registered number: 09239069