Syngenta: Adama need not be sold

DAVOS, Switzerland (Reuters) – Syngenta, the Swiss pesticides and seeds group being taken over by ChemChina, does not expect antitrust regulators to force the Chinese state-owned company to put its subsidiary Adama up for sale, Syngenta’s CEO said Tuesday.

“Adama will not need to be sold. There will be some remedies in both the U.S. and the EU but I can’t speak to any details,” Erik Fyrwald said on the sidelines of the World Economic Forum in Davos.

Unveiling details about Syngenta’s future role within ChemChina for the first time, Fyrwald also said Modi’in Region-based Adama, a maker of generic versions of pesticides without patent protection, would not be folded into Syngenta, allowing the Swiss group to focus on biotech research in China and elsewhere.

The companies are working to finalize agreements with regulators in the United States and European Union about the $43 billion takeover, which would be the largest outbound acquisition by a Chinese company.

Sources close to the matter told Reuters last week that ChemChina and Syngenta had proposed minor concessions to the EU’s competition watchdog, with one person saying it was unlikely Adama Agricultural Solutions Ltd would have to be divested.

The EU Commission recently extended its review of the deal to April 12 and Fyrwald said he was “highly optimistic that by that time, we’ll have made sufficient progress in the U.S. and EU to be going forward”.

Adama would continue to be managed separately because “we’re an R&D company and they’re a generic company. There are different business models”, he added.