The chairman of Syngenta’s board of directors says the company is worth more than Monsanto’s offer, and Michel Demaré says there’s too much down-side risk.
“The proposal significantly undervalued Syngenta’s prospects,” said Demaré, in an interview provided by the company, “but as well really underestimated the huge execution risk of this transaction, as well as the substantial damage that could occur to our integrated business.”
In the last four years the company has increased its earnings per share by 20 percent, said Demaré, and that’s in spite of investing heavily in research and development and in emerging markets.
“The past talks for itself, but what is more exciting is the future,” Demaré said, “and I must say the board is extremely enthusiastic at the current pipeline that we have in our crop protection products and seeing more and more revenues being generated by our premier trait portfolio.”
Demaré expresses concerns about crossing regulatory hurdles where it comes to overlapping areas of products from each company.
“Our external legal counsel has met with Monsanto counterparts on three separate occasions to share our concern about antitrust and also to give them an opportunity to come back to us with solutions,” said Demaré. “They did not do so.”
Monsanto CEO Brett Begemann, in an interview with Brownfield Ag News, says Monsanto has plans for addressing the antitrust issue.
“We never intended to keep the overlapping businesses, so the seed and trait portfolio of Syngenta would be sold to a new owner,” said Begemann. “The overlapping chemistry businesses – they have Touchdown, we have Round-Up – we’ll keep Round-Up and sell Touchdown,” he said.
Syngenta has a metolachlor herbicide platform for corn, while Monsanto has an acetochlor herbicide platform for corn. “We’ll sell one of those,” said Begemann. “It’s a transaction that pretty straight-sailing to get approved through the regulators.”
Syngenta has rejected three offers by Monsanto for the two companies to merge.
Source: www.brownfieldagnews.com