Syngenta plans to buy back more than $2 billion of shares and sell its vegetable seeds business to appease shareholders after having fended off Monsanto’s $47 billion takeover attempt.
Syngenta plans to return “significant levels of capital” to shareholders through buybacks, beginning with the initial $2 billion program that will start in the coming weeks, the company said Thursday in a statement. Syngenta also said Thursday it aims to divest its vegetable seeds business.
Shares of Syngenta fell 18 per cent on 26 August after Monsanto abandoned its attempt, their steepest ever decline. Chief executive officer Mike Mack faces a shareholder base that partly backed engaging with Monsanto. The Basel-based company has said a product pipeline stretching to the end of the decade and positive first-half earnings prove it can hold its own in the agrochemicals industry.
The company said it’s confident to reach a margin target of 24 per cent to 26 per cent in 2018.
Syngenta’s seeds business has already generated interest after Monsanto said it would divest those activities in the event of a successful takeover. BASF SE was interested in looking at assets that could come up for sale, people familiar with the matter said in June. Another logical suitor is Bayer, who has doubled the size of its seeds business to €1 billion ($1.1 billion) over the past five years.
Bloomberg News, edited by ESM
