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ChemChina offers to buy Syngenta for $43bn

Syngenta logo Image copyright Getty Images

Chinese chemicals group ChemChina has offered more than $43bn (£30bn) to take over Swiss agribusiness giant Syngenta.

The deal would be the biggest foreign purchase by a Chinese company.

ChemChina has offered 480 Swiss francs a share in Syngenta.

Shares rose 6% to 415.90 Swiss francs in Zurich on Wednesday.

The Swiss company said it was unanimously recommending the offer to shareholders.

Syngenta chairman Michel Demaré said that the deal would help it to expand further in China.

He told analysts: "ChemChina has a very ambitious vision of the industry in the future. Obviously it is very interested in securing food supply for 1.5 billion people and as a result knows that only technology can get them there."

The company would remain based in Switzerland, reflecting its attractiveness as a corporate location, he said.

Syngenta shares have risen almost 40% in the past 12 months following a $46bn takeover bid from US rival Monsanto. That offer was rejected on competition grounds.

ChemChina does not have a big agricultural chemicals business, but will still need regulatory approval in the US and Europe for the deal to go through.

Analysts at Germany's Baader Bank said that a deal could pose political problems.

However, Syngenta chief executive John Ramsay said he did not expect any major regulatory hurdles: "Syngenta is the world leader in crop protection... This deal will enable us to maintain and expand this position, while at the same time significantly increasing the potential for our seeds business."

ChemChina chairman Ren Jianxin said talks had been "friendly, constructive and co-operative" and that it would seek to maintain its competitive edge in global agricultural technology.

He will become chairman of the Swiss company and four of its existing directors will be on the 10-member board.

The Chinese company owns a variety of businesses, included the Italian tyre maker Pirelli, German machinery-maker KarussMaffei and Israel's biggest pesticides producer.

The deal would be the second-biggest takeover in the chemicals industry in the past year after the $130bn Dow Chemical/DuPont merger announced in December.

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