Swiss agrichemicals firm Syngenta AG is on the lookout for partners that can improve its business after it turned down the acquisition offer of U.S. seed seller Monsanto Co. despite a number of shareholders supporting the deal.
Reuters reported that Syngenta chairman Michael Demare told Swiss newspaper Finanz und Wirtschaft that the company is looking to improve its product portfolio that can further improve the business. The report noted that Syngenta's board is facing shareholder pressure after rejecting Monsanto's $47 billion cash-and-share bid, which it said was too low and faced tough regulatory hurdles.
The wire agency added that Demare is looking at ways to improve earnings but would not want to sacrifice the business's long term prospects to get immediate returns. The report said Demare is not worried about activist shareholders and does not plan to get support from other investors.
The Wall Street Journal said in another report that Syngenta shareholders are angry and may push to change the current board that would support a deal. The report said that Milwaukee-based Artisan PartnersLP, which ranks among the top 10 Syngenta shareholders, estimated that the board's decision to reject Monsanto's offer cost shareholders between $15 billion and $20 billion.
The Reuters added that Syngenta shares closed down by a fifth after the news that Monsanto will discontinue its pursuit, but Demare pointed out that prices are still higher than before the U.S. firm made the offer and that competitors shares are down.
The Journal noted that Monsanto's $46 billion offer as of Aug 18 is higher than the current market value of $31 billion for Syngenta, the world's top pesticide seller.
It added that Monsanto also faces pressure from shareholders as it presented the takeover bid of Syngenta as transformative, but must now convince them the pesticide maker is not needed for continued growth.
The paper, however, said Syngenta faces a greater challenge from shareholders, which could press management to revive talks with Monsanto or have them replaced by those who are open to a deal.
