FTC and European Commission clear ChemChina-Syngenta merger with conditions
The US Federal Trade Commission (FTC) and European Commission have cleared the merger of generic pesticide producer China National Chemical Corporation (ChemChina) and crop business Syngenta.
As part of the FTC’s conditions, the companies have agreed to divest three types of pesticides.
According to a previous complaint filed by the FTC, the merger as originally proposed was likely to cause “significant competitive harm” in the US markets for the three pesticides.
These are the herbicide paraquat (used to clear fields before the growing season); the insecticide abamectin (protects primarily citrus and tree nut crops by killing mites, psyllid, and leafminers); and the fungicide chlorothalonil (used mainly to protect peanuts and potatoes).
Sygenta, which is based in Switzerland, owns the branded version of each of the three pesticides, while
ChemChina’s subsidiary Adama is either the first or second-largest generic supplier in the US for each of these products, the FTC said in a statement released on Tuesday, April 4.
ChemChina is required to sell all rights and assets of Adama’s US paraquat, abamectin and chlorothalonil crop protection businesses to California-based agrochemical company AMVAC.
The commission cleared the merger, subject to conditions, yesterday, April 5.
“Specifically, we found that Adama and Syngenta are close competitors for a variety of pesticides that kill weeds and insects, target plant diseases and treat seeds,” said the commission.
However, the parties have offered to sell off a “major share” of the overlapping business, including a significant part of Adama’s business for pesticides and plant growth regulators, as well as some pesticides owned by Syngenta.
The parties also agreed to sell 29 Adama products that are under development.
“On this basis, we concluded that whoever buys the business will be able to compete effectively, today and in the future, and approved the transaction,” explained the commission.
Did you enjoy reading this story? Sign up to our free newsletter and get stories like this sent straight to your inbox.
