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Dissident shareholder survey calls for sale of Syngenta

December 21, 2015
Chemical Value Chain

A survey released today by the Alliance of critical Syngenta shareholders found that 79% of respondents support an auction to sell the company, and 98% support change at Syngenta’s next shareholder meeting.

The Alliance surveyed 112 shareholders from 7 to 15 December, including 20% of shares held by institutional investors and 10% of shares outstanding. “The findings of the survey support the major change that the Alliance and many other shareholders have called for at Syngenta,” the Alliance says.

Some 89% of survey respondents said that the company’s shareholder strategy has failed, and 94% say the company does not respond to shareholder interests. Some 59% of survey respondents do not support Syngenta’s board of directors.

“The results of this survey, particularly given the broad participation from Alliance members and institutional shareholders, cannot be ignored and represent a call to action for Syngenta shareholders and the board of directors,” the Alliance says. “Change is required. It is clear that if the board of directors continues to entrench itself and fails to address shareholder concerns, they do so at their own peril.”

Syngenta criticized the survey. The company has “met with shareholders representing over 45% of share capital in recent weeks,” it said in a statement. “Syngenta already has a clear understanding of its shareholders’ views.”

Syngenta met with representatives of the Alliance, the company says. “Despite having had the opportunity to represent their views to Syngenta’s board and management, the Alliance has proceeded with this anonymous shareholder survey,” Syngenta says. “Such an initiative is not in keeping with the constructive tone of a relationship which should exist between a company and its shareholders.”

The Alliance is an anonymous group of private and institutional Syngenta shareholders, represented by Martin Lehmann, a partner with 3V Asset Management (Zurich) and Folke Rauscher, a financial communications executive.

Syngenta has been a target of frequent M&A speculation in recent months. The company spurned a $47 billion hostile bid from Monsanto over the summer, and reports have linked the company to ChemChina in recent weeks. In October, Mike Mack stepped down as CEO, to be replaced by CFO John Ramsay on an interim basis.

The Dow-DuPont merger – which will result in the creation of a $19-billion agchems giant – has also turned up the heat on Syngenta. The deal reinforced already-fervent speculation about consolidation among the “big six” ag majors, which include Syngenta, Monsanto, Dow and DuPont, along with Bayer and BASF.

Syngenta’s largest shareholders are institutional investors Delaware Investments, Van Eck Associates, and Wellington Management.

By Vincent Valk

Source: Chemical Week

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