ChemChina secured EU competition approval today for its $43 billion bid for Swiss pesticides and seeds group Syngenta, a crucial deal that could help China boost its domestic agricultural output.
The deal is the largest foreign acquisition by a Chinese company.
It is one of several that is reshaping the international market for agricultural chemicals, seeds and fertilizers even as they trigger fears among farmers that the pipeline for new herbicides and pesticides might slow.
Reuters reported on February 2 that the deal would be cleared with conditions.
The European Commission said the asset sales addressed its competition concerns.
"It is important for European farmers and ultimately consumers that there will be effective competition in pesticide markets, also after ChemChina's acquisition of Syngenta," European Competition Commissioner Margrethe Vestager said in a statement.
ChemChina will sell a large chunk of its subsidiary Adama's pesticide, herbicides and insecticides business, its seed treatment products for cereals and sugar beet and a substantial part of its plant growth regulator business for cereals.
Some of Syngenta's pesticides will also be put on the block.
The world's biggest pesticides maker Syngenta sells its products in more than 90 countries under such brand names as Acuron, Axial, Beacon and Callisto. It sells seeds such as cereals, corn, rice, soybeans and vegetables.
US competition authorities also approved the deal last night on condition that ChemChina divest three products.
To gain US approval, the companies agreed to divest ChemChina's generic production of the herbicide paraquat, the insecticide abamectin used for citrus and tree nuts and the fungicide chlorothalonil, used for peanut and potato crops.
Syngenta owns the branded versions of the three products while ChemChina's subsidiary ADAMA sells generic versions to US farmers.
ChemChina has agreed to sell the generic businesses to AMVAC, a California-based company. The deal is one of several that is remaking the international market for agricultural chemicals, seeds and fertilizers.
The other deals in the sector are a $130 billion proposed merger of Dow Chemical and DuPont and Bayer's plan to merge with Monsanto.
On the fertilizer front, Potash has announced plans to merge with Agrium.
