“No Security Issues” in Syngenta Sale to China

Swiss agrochemicals giant Syngenta has sought to assure US lawmakers critical of the company’s planned $43 billion takeover by ChemChina that the deal poses no food safety or national security issues.

The company said it “welcomes the full review of the transaction by the US government.”

Chuck Grassley, a Republican member of the US Senate Committee on Agriculture, Nutrition and Forestry told the newspaper Wall Street Journal that a bipartisan group of senators would seek a formal role for the US Agriculture Department as the Committee on Foreign Investment in the US (CFIUS), carries out its review.

In a radio interview, Grassley said he was concerned that ChemChina's ownership of Syngenta would give Chinese interests access to a vital part of the US agricultural infrastructure.

A ChemChina acquisition of Syngenta would also give China even more control over the global market for genetically modified corn, soybean and other seeds than it already has, the senator added.

US Agriculture Secretary Tom Vilsack said in March that he, too, had reservations about the transaction and its impact on US competitors trying to enter the Chinese market.

The US government has a say in the matter because of Syngenta’s considerable presence in the country, where it makes around a quarter of its sales. The Swiss company is the largest producer of insecticides in the US. It also supplies an estimated 10% of the country’s soybean seeds and 6% of its corn seeds.

CFIUS is made up of representatives from 16 agencies, including the Defense, Homeland Security and Treasury Departments. Up to now, the organization has rejected deals on national security, but never food security grounds, reports said.

As part of its review, the organization is expected to scrutinize Syngenta’s chemical facilities located close to US military sites. Some members of Congress are keen to see CIFUS review more such transactions, especially where Chinese companies are involved.