A Chinese state-owned chemical maker has offered $43 billion to buy Swiss pesticide giant Syngenta, which has a plant in St. Gabriel and three leased warehouses in Baton Rouge.
Under various names, Syngenta has operated its 300-acre St. Gabriel site since 1970. The company has about 975 local employees. Officials have said it makes and packages locally 130 selective herbicides, nonselective herbicides and insecticides.
Syngenta AG said its board is recommending shareholders accept the offer from China National Chemical Corp., also known as ChemChina. The deal would be the biggest foreign acquisition by a Chinese company.
Sygenta agreed to the takeover bid after spurning a $46.5 billion offer from agricultural giant Monsanto.
The deal is part of a global acquisition spree by Chinese companies, which are diversifying abroad to counter a slowdown at home while also seeking foreign expertise and technology. Last month, Chinese home appliance maker Haier Group bought General Electric’s home appliance business while conglomerate Wanda Group acquired Hollywood movie studio Legendary Entertainment.
The Syngenta deal, if completed, would overtake CNOOC’s 2012 purchase of Canadian energy company Nexen as the biggest foreign acquisition by a Chinese company, according to Dealogic data.
Beijing-based ChemChina will keep existing Syngenta management in place following the deal, which is expected to be completed by the end of the year.
Last month, ChemChina bought German machinery maker KraussMaffei for about $1 billion and took a 12 percent stake in Swiss energy trader Mercuria. In March, it bought Italian tire manufacturer Pirelli.
The Syngenta deal is also part of a shake-up of the global agricultural and chemical industry, which is being pressured by tumbling commodity prices that are forcing farmers to spend less on seeds, pesticides and equipment. The company reported Wednesday that net income for 2015 fell 17 percent to $1.3 billion as it struggled with low crop prices, instability in emerging markets and currency fluctuations.
For China, it’s an opportunity to beef up its expertise in the “ag-chem” industry as part of President Xi Jinping’s plan to modernize the country’s farms to keep up with demand from a rising consumer class.