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Aug. 4, 2015 St. Louis Business Journal reports: A recent poll of current and former Syngenta investors has found that they overwhelmingly favor the Swiss agribusiness company negotiating with Monsanto Co. on an acquisition deal. The survey, done by investment research firm Sanford C. Bernstein and Co. Inc., found that 92 percent of the 100 investors polled over the past week favored sitting at the table with Monsanto, compared with 3 percent who wanted to keep to the company's current strategy and management team. Of those who favored negotiating with Monsanto, the average "desired" offer was 5 percent higher than Monsanto's $45 billion bid, which has been rejected twice this year by Syngenta leadership. Only 32 percent of those surveyed said they would accept Monsanto's current offer, Bernstein said in a report released Monday. According to Bernstein analyst Jeremy Redenius, Syngenta investors are also "deeply skeptical of Syngenta's current strategy and (earnings) targets primarily due to management issues and an unfavorable agricultural cycle." Investors also described the company's lack of engagement with Monsanto over a possible acquisition as "incredible" and "not appropriate." Redenius outlined three possible ways to forward for Syngenta: *Deal with Monsanto, which investors could push for through an "Extraordinary General Meeting"; *Seek another deal (for example, a merger with Dow AgroSciences); or *Change the strategy dramatically. According to the poll, investors would want changes to the company's cost focus, divestiture of Syngenta's seed business - which Monsanto has said it is committed to in a merger scenario - increased shareholder returns, management change, and same or increased R&D. In a emailed statement, a Syngenta spokeswoman said of the poll, "Following our recent half year results, we have met with over 100 investors in Europe and the US and it is clear from these conversations that the proposal from Monsanto is wholly unacceptable as it fundamentally undervalues Syngenta's future prospects and is fraught with significant execution and regulatory risk." Monsanto leaders have said they would not increase the offer price for Syngenta without seeing more information from the company's books that would justify a higher value of the company. In related news, Reuters reported Monday that German chemicals maker BASF has lined up a loan package from banks for a possible acquisition offer for Syngenta. The report said that BASF would only bid for Syngenta if Monsanto makes an offer and that BASF "was comfortable with there being no merger at all and the status quo in the industry prevailing." Tweet |
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