FTC Requires ChemChina And Syngenta To Divest U.S. Assets As Condition Of Merger

(RTTNews) - China National Chemical Corp. or "ChemChina" and Swiss global agricultural company Syngenta AG (SYT) have agreed to divest three types of pesticides, in order to settle Federal Trade Commission charges that their proposed merger would harm competition in several U.S. markets.

According to a complaint filed by the FTC, the merger as originally proposed is likely to cause significant competitive harm in the U.S. markets for three pesticides: the herbicide paraquat, which is used to clear fields prior to the growing season; the insecticide abamectin, which protects primarily citrus and tree nut crops by killing mites, psyllid, and leafminers; and the fungicide chlorothalonil, which is used mainly to protect peanuts and potatoes.

The complaint alleged that without the proposed divestiture, the merger would eliminate the direct competition that exists today between ChemChina generics subsidiary ADAMA and Syngenta's branded products. The merger would also increase the likelihood that U.S. customers buying paraquat, abamectin, and chlorothalonil would be forced to pay higher prices or accept reduced service for these products, the complaint states.

The proposed settlement requires ChemChina to sell all rights and assets of ADAMA's U.S. paraquat, abamectin and chlorothalonil crop protection businesses to California-based agrochemical company AMVAC.