Syngenta AG, the globally prominent Swiss pesticides and seeds company, in conjunction with Adama Agricultural Solutions Ltd., a pivotal subsidiary of ChemChina, has announced a joint decision with regards to the sale of a range of crop protection products to an Australia based agricultural chemicals company, Nufarm Ltd. If reports are to be believed, the deal is worth close to USD 490 million.
As per sources, the crop protection product portfolio that is on the cards for sale encompasses off-patent crop protection formulations in fungicides, insecticides, herbicides, and myriad other categories. The deal also marks a significant precedent in agricultural films industry, cite experts, on the grounds of the fact that it would lead to the expansion of the crop protection spectrum that demands the deployment of these plastic films for protecting crops from pests and insects. The portfolio is inclusive of 50 crop protection product lines, which would necessitate a tremendous demand for agricultural films market, as per experts.
It has been reported that this crop protection business is being divested as a part of the requirements put forth by the European Union for having approved the China National Chemical Corporation’s acquisition of Syngenta, for a valuation of more than USD 42 billion. The multi-billion-dollar takeover apparently had necessitated the approval of numerous regulatory bodies.
The purchasing party, Nufarm, according to analysts, stands to gain much through this sale, and may considerably consolidate its position in the regional agricultural films market as well. Representatives of the Australian-listed agricultural firm stated that these crop protection products have been forecast to generate a yearly valuation if AUD 250 million, with an operational revenue of almost AUD 100 million by the financial year 2019.
Authentic reports state that Syngenta would be selling its inventory worth USD 50 million to Nufarm at the time of the agreement closure, which may take place somewhere in the beginning of the year 2018. Also, representatives from Syngenta AG were quoted stating that no physical assets whatsoever apart from the proposed inventory or otherwise, would be transferred to Nufarm as a part of the agreement.