This case discusses ChemChina’s US $43 billion acquisition of Swiss agribusiness giant Syngenta as a part of its growth strategy. This deal was the largest-ever foreign acquisition by a Chinese firm (as of 2017), indicating China’s rising power in the global market. The case explores the reasons that made ChemChina to go in for this acquisition along with its outcomes for both the companies involved. The case also briefly describes the market scenario and key players and the rapid consolidation that was taking place in the agro-chemical industry. It also presents the measures that ChemChina intends to undertake to make the integration and transition process easy and smooth for Syngenta. At the end, the case facilitates a critical discussion on ChemChina’s decision to select acquisition as a part of its growth strategy.

The ChemChina-Syngenta deal was one of the three mega-deals in the international agricultural market for chemicals, seeds, and fertilizers. The acquisition was the result of China’s quest to increase its food production and thereby resolve global food security woes, primarily caused by the growth in world population. China, the world's second-largest market for crop seeds, had been looking for ways to improve its crop production and, according to experts, ChemChina's ownership of a top global supplier of seeds and pesticides would hasten the expansion of the agricultural sector in China. Apart from this, market experts believed that this deal would also give China more control over global food production, as it would gain access to innovative technologies along with Syngenta’s patented seeds and gene-modification technologies.

Will this decision to acquire a company overseas help ChemChina become a global leader in the agro-chemicals industry? Was it the right choice for ChemChina to go in for an outbound deal as a part of its growth strategy?

Business Environment Case Studies | Case Study in Management, Operations, Strategies, IT and Systems, Case Studies

Business Environment Case Studies Case Studies | Case Study in Management, Operations, Strategies, IT and Systems, Case Studies

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Issues

The case is structured to achieve the following teaching objectives:

	Identify the key reasons for companies going in for a M&A
	Understand the factors/best practices for a successful outbound M&A
	Analyze the major archetypes of an outbound M&A
	Discuss the life cycle/Phases of an M&A process
	Understand how overseas M&As assist a country’s growth strategy

Contents

INTRODUCTION

CHINA’S RISING POWER IN THE GLOBAL MARKET

ABOUT CHEMCHINA

CONSOLIDATION OF GLOBAL AGRIBUSINESS

THE MEGA DEAL

SEEDS OF GROWTH

A PUSH TOWARD GM TECHNOLOGIES?

HANDLING THE REGULATORY ROADBLOCKS

THE ROAD AHEAD

EXHIBITS

Keywords

Mergers and Acquisitions,Chemicals,ChemChina,Syngenta,Genetically Modified Seeds (GMO),Business Growth Strategy,Overseas Acquisition,China,Outbound acquisitions,Syngenta,Global food security,Acquisition,Chinese companies

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