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Opinion

Asia: ChemChina/Syngenta out of fashion just as it arrives

One of the world’s most ambitious and laborious deals approaches its conclusion and will not be repeated in a hurry.

ChemChina-Syngenta-Jianxin-Demare-R-600
Ren Jianxin (left), chairman of ChemChina, with Syngenta's chairman
Michel Demaré at the announcement in February 2016

Word reaches us that the $46 billion acquisition of Syngenta by ChemChina will close on Thursday, about 15 months after its formal announcement. Even as it staggers to the finish line, it already looks like a throwback.

A lot has changed in the year or so since ChemChina made a cash offer for the Swiss seed and chemical company in February 2016.

Then, the bid represented the high point of Chinese outbound largesse, though at the time its size was not particularly out of place and its rationale looked a hell of a lot stronger than some of the other weird and wonderful deals being proposed.

This was a time when the lexicon of M&A was being rewritten, with reverse break fees and the ‘random Chinese buyer’ becoming industry tropes.

Now, though, it looks like the sort of deal we might not see again for a long time.

Change of attitude

Late last year, Chinese state institutions changed their attitude towards capital leaving the country and made it a lot harder for deals to gain approval.

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