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Syngenta Says 2013’s M&A Spending May Match Record $650 Million

Syngenta AG said the pace of acquisitions may match the record $650 million spent on takeovers last year as the world’s largest maker of crop chemicals pursues seed technologies and start-up businesses.

“There’s plenty of opportunities that we are continuing to pursue,” Chief Executive Officer Mike Mack said in an interview. “If we are lucky” the tally will equal last year’s value, Chief Financial Officer John Ramsay said.

Syngenta is somewhat restricted in its M&A ambitions. There are only a couple of medium-sized targets left, according to the CFO. DuPont Co. and Dow Chemical Co. are expanding their rival agrochemical divisions, and any asset sporting new technology and farming solutions that comes to market attracts a broad field of suitors.

Mack wants to double sales to $25 billion by 2020 buoyed by a company-wide reorganization along crop lines and purchases. Syngenta bought hybrid-rice seed-maker Devgen for $523 million last year.

Basel-based Syngenta had sales growth of 7 percent, lagging behind Monsanto Co.’s 14.2 percent, and the 13.4 percent reported by DuPont Co.’s agribusiness in their 2012 fiscal years. Monsanto raised its full-year guidance for free cash flow to $2 billion.

Shares of the company fell 2.8 percent to 384.3 francs as of 9:11 a.m.

Latin Buzz

Net income rose 17 percent to $1.87 billion last year, compared with an estimated $1.82 billion, based on 15 analyst predictions collected by Bloomberg. Syngenta said it plans to pay a dividend of 9.5 francs, beating a Bloomberg analyst forecast of 8.6 francs.

Syngenta got a boost from Latin America operations which seasonally contribute a greater share of revenue in the fourth quarter as high soybean prices led farmers to spend more on sprays and seeds.

The company plans to invest $77 million in the expansion of its corn seed production facility in Formosa, Brazil, driven by growing demand for corn hybrids to feed cattle, pigs and chickens. Syngenta’s corn market share grew by 30 percent last year to 13 percent in Brazil as it made gains versus dominant competitors Monsanto and Pioneer, Mack said.

Board Reshuffle

Sales of Syngenta’s Force insecticide more than doubled in 2012, helped by insect resistance to Monsanto’s YieldGard corn, Mack said.

Syngenta said its board will propose the election of two new directors, Eleni Gabre-Madhin, former CEO of the Ethiopian Commodity Exchange and Eveline Saupper, a partner at Swiss law firm Homburger AG, at the annual general meeting on April 23. In addition to the Chairman, Martin Taylor, three directors -- Peggy Bruzelius, Peter Thompson and Felix Weber -- will retire on the same date, having completed their terms of office.

ABB’s former CFO Michel Demare will take over as chairman this year.

To contact the reporter on this story: Patrick Winters in Zurich at pwinters3@bloomberg.net

To contact the editor responsible for this story: Simon Thiel at sthiel1@bloomberg.net

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