Syngenta’s $ 10 billion Shanghai IPO to fund growth and acquisitions

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HONG KONG / ZURICH, July 2 (Reuters) – The Syngenta Group will use the proceeds of its $ 10 billion initial public offering (IPO) to fund organic growth and a wave of acquisitions to capture a larger Seeds and sprays market share of $ 100 billion, giant said Friday.

The company’s prospectus to list on the Shanghai Nasdaq-style STAR marketplace was released online by the Shanghai Stock Exchange on Friday, confirming details reported this week by Reuters after the request was filed on Wednesday. Read more

“The Syngenta Group will expand and renovate its production facility and implement a strategic acquisition to meet growing market needs,” the company said in the document.

Syngenta said on the record that its application for listing on the STAR Marketplace has been approved and will issue up to 2.79 billion shares.

The show, set to be the largest in the world this year, will value the Basel, Switzerland-based pesticide and seed maker at around $ 60 billion including debt, or $ 50 billion without, people said. sources at Reuters.

The filing means the IPO is expected to take place by the end of 2021, said the sources, who were not authorized to speak to the media and declined to be identified.

A secondary listing of Syngenta is also being considered which could take place within a year of its debut, with exchanges in Zurich, London and New York among options under consideration, the sources said.

The proceeds will finance acquisitions, including previously announced deals to buy Yangnong Agrochemical and Valagro, according to the filing.

The funds collected will also be used for other projects such as research into advanced agricultural technologies, expansion of production and modernization and maintenance of its facilities.

The funds will also be used to further expand its modern agricultural services platform – which trains farmers in China – and to pay off long-term debt, he said.

The Swiss seed and crop protection giant was acquired in 2017 for $ 43 billion by ChemChina, which was integrated this year into Sinochem Holdings Corp.

The acquisition remains China’s largest takeover of a foreign company and aims to use Syngenta’s leading chemicals and patent-protected seeds to dramatically improve domestic agricultural production.

Since its takeover, Syngenta has merged with Israeli agrochemical company ADAMA and Sinochem’s fertilizer and seed business.

Syngenta, the world’s leading manufacturer of crop protection products and third-largest supplier of seeds, competes with German BASF (BASFn.DE), Bayer (BAYGn.DE) and the American agrochemical company Corteva (CTVA.N) in the speed market and sprays.

The company employs 49,000 people worldwide and generated sales of $ 23.1 billion in 2020. Its main markets are the United States and Brazil, while it is growing rapidly in China.

Syngenta reported first quarter revenue of $ 7.1 billion, 20% higher than year-on-year, with earnings before interest, taxes, depreciation and amortization up 19% to 1.5 billion of dollars.

Net profit rose 72% in the first quarter, according to the prospectus.

($ 1 = 6.4705 yuan Chinese renminbi)

Reporting by John Revill in Zurich, Meg Shen in Hong Kong and Dominque Patton in Beijing; Editing by David Clarke

Our Standards: Thomson Reuters Trust Principles.


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