EC delays ChemChina-Syngenta merger decision
January 18, 2017
The European Commission (EC) has delayed its ChemChina-Syngenta merger decision for a second time by 10 working days to 12 April.
Swiss pesticides and seeds group Syngenta said the two companies had asked for the extension to allow "sufficient time for the discussion of remedy proposals".
The EC launched an antitrust investigation into state-owned ChemChina's US$43bn bid in October, saying the companies had not allayed concerns over the deal.
Commissioner Margrethe Vestager, in charge of competition policy, said last year that: "This deal would lead to the combination of a leading crop protection company with one of its main generic competitors. Therefore we need to carefully assess whether the proposed merger would lead to higher prices or a reduced choice for farmers".
The proposed merger would combine Syngenta, one of the main global seeds and crop protection companies, and ChemChina, which controls Adama, the largest supplier of generic crop protection products in Europe.
The EC said Syngenta and ChemChina – through Adama – each had strong partially overlapping portfolios of crop protection products including herbicides, insecticides, fungicides and plant growth regulators, used for the cultivation of cereals, cotton, corn, fruits and vegetables, rapeseed, soyabean, sugarbeet and sunflowers.
As well as looking into reduced competition in a number of crop protection markets, the EC is also examining whether the merger may negatively affect Syngenta's and ChemChina's supply of active ingredients, which are the key chemical input for other manufacturers to make crop protection products.
The merger was first announced on 3 February and other competition authorities, including in Brazil, Canada and the USA, are also investigating the deal.
ChemChina is active in the agrochemical sector through its agrochemical division China National Agrochemical Corporation (CNAC) and its wholly-owned subsidiary Adama Agricultural Solutions. Adama an Israeli company which manufactures and distributes off-patent crop and pest protection products, and sells active ingredients to other crop protection producers.
Also under review in the seed and crop protection sphere is the US$130bn merger of US chemicals giants Dow Chemical and DuPont; and German chemicals firm Bayer’s US$66bn acquisition of US seeds giant Monsanto (see Biotech News, OFI January 2017 and November/December 2016).