Syngenta AG (SYNN), the world’s largest maker of crop chemicals, said it will continue to pursue takeovers after agreeing to buy Belgian hybrid-rice maker Devgen last month.
“This is an example where in one quarter we can take three quarters of a billion dollars off the balance sheet without a blink,” Chief Financial Officer John Ramsay said in an interview. “M&A continues to be a major part of our strategy.”
The Swiss company is seeking to overcome resistance to chemical-based pesticides, its largest business, by buying up smaller makers of biological alternatives as well as genetically modified traits to boost revenue to $25 billion by 2020 from $13.3 billion. Syngenta last month agreed to buy Devgen for 403 million euros ($526 million) and biological controls company Pasteuria Bioscience for $113 million.
Third-quarter sales rose 1.3 percent from a year earlier to $2.7 billion, Basel-based Syngenta said in a statement today. That compared with the $2.76 billion average estimate of analysts in a Bloomberg survey. Competitor Monsanto Co. (MON:US) reported sales on Oct. 3 that missed analyst estimates.
Syngenta shares rose 1 percent to 346.9 Swiss francs as of 10:08 a.m. in Zurich.
There are “very few, perhaps one or two” viable takeover targets left on the market, Ramsay said, as Syngenta battles rivals to capture the most innovative bug-fighting technologies.
BASF SE (BAS) and Bayer AG (BAYN) have pumped up their biological crop- chemicals units. BASF agreed to buy Becker Underwood Inc. for $1.02 billion in September and Bayer said in July that it would buy Agraquest Inc. for $425 million.
Drought restrained Syngenta’s fungicide sales in the U.S. in the third quarter and a delayed monsoon caused a shortfall in crop-chemical sales in India and Japan even as sales rose 18 percent in Latin America amid higher soybean prices.
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