ChemChina, Syngenta miss EU deadline

EU regulators have until Oct. 28 to approve deal or open extended probe.

Syngenta AG shares tumbled Monday over concerns that the $43 billion takeover of the Swiss herbicide and pesticide maker by China National Chemical Corp. (ChemChina) is at risk of regulatory delays in the European Union, Bloomberg reported. ChemChina missed the Oct. 21 deadline for submitting so-called remedies in the EU’s early-stage review of the deal, the European Commission’s press office told Bloomberg.

Companies undergoing complex EU reviews occasionally decide not to offer commitments at an early stage if they know a deal will likely get deeper scrutiny by regulators. However, Bloomberg said the move raises concerns about how quickly the deal would gain regulatory approval.

EU regulators now have until Oct. 28 to decide whether to approve the deal without any strings attached or open an extended "phase two" probe that could add at least another four months before a final decision is made.

Bloomberg reported that Syngenta's shares fell 7.6% to 390 Swiss francs at 12:03 p.m. Monday after dropping by as much as 9.1% in Zurich, Switzerland, trading — the steepest decline since August 2015.

A longer review raises risks as ChemChina is now facing a potential merger merger with Sinochem Group as part of an overhaul of China's state-owned enterprises, Bloomberg reported. While the EU usually approves deals after a longer probe, it has blocked deals due to competition concerns.

Syngenta spokesman Leandro Conti told Bloomberg that “constructive discussions with the EU are ongoing” and that the company “will issue an update on the progress of the ChemChina transaction with its third-quarter trading statement tomorrow.” A ChemChina representative couldn’t immediately comment.

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