31 Dec

Introducting the Mega Deal between Monsanto and Syngenta

WRITTEN BY Steve Ariel FEATURED IN M&A and Event Driven

Overview of the Monsanto and Syngenta deal

Recently, Syngenta AG (SYT), the world’s largest pesticide company, started talking about deals with global agrochemical players such as Monsanto (MON) and ChemsChina. Initially, Monsanto expressed its interest in acquiring Syngenta in May and announced a takeover bid of $46 billion in August. However, Syngenta declined Monsanto’s offer primarily due to the lower valuation. Later, Monsanto withdrew its takeover bid.

Introducting the Mega Deal between Monsanto and Syngenta

On December 18, 2015, John Ramsay, the interim chief executive officer of Syngenta, said that Syngenta is seriously looking for a deal with the global agrochemical players including Monsanto. This is probably to enhance its market position in the agricultural chemical space to counter the recent merger between the two agrochemical giants Dow Chemical (DOW) and DuPont (DD).

On December 22, 2015, Syngenta’s chairperson Michel Demare also said that the company is negotiating a deal with Monsanto and ChemsChina, but hasn’t received the takeover bid yet. Wall Street reacted positively to this news and Monsanto’s stock rose 3% while Syngenta’s stock rose 7% since December 18, 2015.

About Monsanto

Monsanto is the world’s leading agricultural chemical company with a presence in more than 150 countries. The company produces biotechnology seeds, herbicides, biotechnology traits, and precision agriculture products to improve farm yields and lower costs for farmers. The company has two product segments, namely Seeds and Genomics and Agricultural Productivity. It has reported total sales of $15 billion in 2015 with the total market capitalization of $43 billion as of December 29, 2015.

About Syngenta

Syngenta, a European company, is also one of the world’s largest agriculture companies with a presence in 90 countries. Syngenta’s products include crop protection, seeds, as well as lawn and garden products. Its major crop protection products are herbicides, insecticides, fungicides, and seed treatments. The lawn and garden business provides flower turf and landscape, as well as pest control products. The company has generated total sales of $15 billion in 2014 with the total market capitalization of $37 billion as of December 29, 2015.

This isn’t the only deal in the pipeline, as other major players are also involved in mergers and acquisitions deals. We’ll discuss the industry consolidation in our next part before discussing the MON–SYT deal in detail. The Materials Select Sector SPDR (XLB) ETF, a major chemical ETF, primarily tracks the performance of major chemical players. MON forms 8% of XLB’s total holdings.

Latest articles

Monster Beverage (MNST) stock was down 1.6% as of 2:47 PM EDT on March 20.

Earlier today, the second-largest US automaker by 2018 sales volume, Ford Motor Company (F), revealed its plan to invest $850 million in its Flat Rock assembly plant through 2023.

Mizuho downgraded Yum! Brands (YUM) from “neutral” to “underperform” while keeping its 12-month price unchanged at $84, which represents a fall of 15.4% from its March 19 closing price of $99.20.

20 Mar

Why Verizon Sought to Lead 5G Rollout

WRITTEN BY Rachel Gunter

According to Verizon, its mobile 5G plans will cost $10 more than its current 4G plans.

As of March 19, Dunkin’ Brands (DNKN) was trading at $71.55, which represents a rise of 3.9% since the announcement of its fourth-quarter earnings on February 7.

Suncor Energy's shareholder returns have grown consistently over the past few years. The company hasn't forgotten its commitment to growth.