Syngenta (SYT) May Be Targeted by Acquirer or Activist Shareholder, Says Deutsche Bank

Deutsche Bank earlier reiterated a Buy rating on Syngenta (NYSE: SYT). Analyst Virginie Boucher-Ferte thinks it could be targeted by an acquirer or an activist shareholder.

" . . .with growing evidence that consolidation is about to accelerate and the rise of shareholder activism we believe the pressure on mgmt to deliver in the shorter term is immense. If not, we believe external actions could arise, which may include an acquirer or an activist shareholder," said Boucher-Ferte.

"We are seeing growing evidence that M&A activity in the agrochemical and seed is about to resurge: Dow Chemicals (NYSE: DOW) signalling its intention to exit its ag business by the end of the decade, recent speculation around Monsanto (NYSE: MON) /Syngenta talks, FMC planned acquisition of Cheminova and the growing interest from Asian players in Western/developed markets players. We remain of the view that there will be more consolidation in the space in the coming years, with acquirers being tier 1 players looking to broaden their existing presence (e.g. Monsanto entering the Crop Protection market, Bayer or BASF expanding their seeds franchise, DuPont (NYSE: DD) expanding its Crop Protection franchise etc) or Asian (Chinese) companies looking to acquire high end agchem/seed technologies, due to governments' desire to increase domestic productivity and safeguard food security.With most large tier 1 chemical/seed businesses being held by large conglomerates who consider these businesses as core (except Dow), we believe the strategic value of Syngenta should not be underestimated," added the analyst.

For an analyst ratings summary and ratings history on Syngenta click here. For more ratings news on Syngenta click here.

Shares of Syngenta closed at $63.37 yesterday.

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