Agriculture

China catalyst could spark Syngenta chain reaction

13 Nov 2015

The Swiss pesticides group has rejected a $42 bln bid approach from China National Chemical Corp, reports say. Interest from rival Monsanto was rebuffed earlier this year, and last month the Syngenta CEO stepped down. It looks vulnerable to a round of chemical re-engineering.

Syngenta CEO exit opens door to opportunists

21 Oct 2015

Mike Mack will leave the $30 bln Swiss agrochemical company. Shareholders grumbled that the company fumbled a bid from Monsanto. New leadership may be more credible than Mack in cutting costs. Meanwhile, Syngenta looks more open to a bid or a breakup.

Monsanto plants seeds for weathering rough times

7 Oct 2015

Weak grain prices and forex swings battered the crop giant’s earnings, bringing a lower 2016 forecast just weeks after its Syngenta bid collapsed. The whole sector is down, though, and a faster stock buyback and $300 mln of cost cuts will help the company through a lean period.

Monsanto leaves Syngenta facing awkward questions

26 Aug 2015

The world’s largest seed maker has given up pursuit of its Swiss rival. The $46 bln deal required aggressive assumptions and carried risks. Syngenta’s management now needs to prove its reluctance to talk was worth it. 

Monsanto $46 bln Syngenta offer deserves a hearing

26 Aug 2015

The U.S. seed giant’s last cash and shares approach to its Swiss rival was rebuffed. Monsanto has offered a little more, but can’t go much higher without destroying value or relying on rosy assumptions. The pressure is on Syngenta to talk, or show investors it has a better plan.

Fertilizer deal offers investors bountiful harvest

6 Aug 2015

CF Industries’ $6.1 bln bid for most of rival OCI’s businesses comes with $500 mln of cost cuts that over time will virtually pay for the acquisition. The deal should also boost production capacity by 65 pct. Those are some powerful nutrients for shareholders to absorb.

Fertilizer deal talks emit whiff of exuberance

20 Jul 2015

U.S. nitrogen giant CF Industries is sizing up $6 bln Dutch rival OCI. A combination could bring tax and other savings. CF got the timing right when it bought rival Terra in 2010. This time, prices are falling and new supplies arriving. The M&A enthusiasm looks excessive.

Big Agriculture can weather foodie feedback loop

13 May 2015

Moves by the likes of Chipotle and Panera to drop genetically modified foods and other artificial ingredients risk snowballing. It’s a manageable problem, even for richly valued seed makers like Monsanto. Appeals to science are unlikely to change minds, but better products might.

Monsanto would have to dig too deep for Syngenta

11 May 2015

Big holders in the Swiss agribusiness say they’d back a $50 bln bid, or 10 pct more than the U.S. crops company offered last week. To justify a price that high, however, would require Monsanto to find at least $2 bln in annual cost savings. That sounds like an implausible harvest.

WH Group looks stuck in a value trough

4 Dec 2014

Shares in the Chinese-American pork producer have fallen 31 pct since its August IPO. Unusual moves by its chairman and a private equity backer are partly to blame. Though the stock now looks cheap, some long-term investors will soon be free to sell. Any recovery seems far off.

China dairy correction churns Fonterra profits

24 Sep 2014

A 76 percent fall in earnings for the New Zealand dairy group shows the China milk bubble deflating. Record milk prices have tested consumers’ tolerance, and traders may have overstocked. The underlying trends are still positive, but it will take a while to skim off the froth.

Giant fertiliser combo looks tough to cultivate

23 Sep 2014

Norway’s Yara is talking to U.S. rival CF Industries about a $27 bln tie-up. The two boast similar valuations and could reap sizeable synergies. Hence a near-$1 bln jump in Yara’s market cap. But a merger of equals is one of the trickiest deal varieties.

Fonterra’s China deal eases memories of spilt milk

28 Aug 2014

Buying a stake in baby food group Beingmate at a 25 percent premium is brave for the New Zealand dairy co-op, whose ex-partner Sanlu sold tainted milk in 2008. Focusing the tie-up on products made outside China is wise. But rising scrutiny of foreign companies ups the stakes.

U.S. farm credit looks safer than houses

19 Aug 2014

Washington’s $200 billion-plus subsidized agricultural lending complex includes Farmer Mac, a rural copy of ill-fated Fannie Mae and Freddie Mac. Despite a hot farmland market, though, the system looks ruggedly capitalized enough to avoid the bailout fate of the home-loan behemoths.

ADM goes M&A wild – sort of

7 Jul 2014

The $30 bln U.S. food giant is buying Swiss natural ingredient maker Wild Flavors for $3 bln. It’s ADM’s biggest deal, and a shift from its commodity business. A small add-on with like customers makes sense but won’t change how investors see the firm. The question is, what next?

Syngenta can yield extra value for shareholders

24 Jun 2014

Shares leapt on a report Syngenta had held abortive talks with rival Monsanto, in the latest tax-driven push by a U.S. acquirer. There would be big antitrust obstacles. Even if no deal emerges, the bid talk should pressure the Swiss agribusiness giant to tend to its own garden.

Rival’s split makes it harder for Dow to resist

10 Mar 2014

FMC, a $10 bln pesticide-to-battery-parts maker, is splitting its fast-growing ag and pharma businesses from stodgier commodity minerals. It’s similar to the breakup activist Dan Loeb wants at Dow Chemical. Boss Andrew Liveris is standing firm. FMC’s move weakens his case.

China’s push into food trading will be piecemeal

6 Mar 2014

State-backed COFCO is eyeing an agriculture joint venture with Singapore’s Noble, a week after taking control of Dutch grain trader Nidera. COFCO’s mission to ensure China’s food security is finally translating into large overseas acquisitions. Yet targets remain in short supply.

Proof of potash cartel revival will be in pricing

27 Jan 2014

New Kremlin-backed owners at Russia’s Uralkali, the world’s biggest potash producer, appear open to reviving a marketing alliance with Belarus. But it’s far from a done deal. Even if the cartel returns, it’s unlikely to survive long once BHP Billiton enters the business. 

Merck woes show animal drugs are no panacea

30 Dec 2013

Animal medicine, whether for livestock or pets, is booming. Pfizer’s spinoff, Zoetis, trades at a fat valuation premium. But controversy over Zilmax, Merck’s muscle-building feed additive, suggests that an increasingly complicated food chain comes with its own investment risks.