Syngenta management faces pressure to appease investors

Thu Aug 27, 2015 10:07am EDT
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By Ludwig Burger

FRANKFURT (Reuters) - Syngenta SYNN.VX management faced pressure on Thursday to offer tangible rewards to shareholders after the Swiss pesticides company turned its back on a deal with unwanted American suitor Monsanto (MON.N: Quote).

With no alternative bidder seen on the horizon, analysts speculated that the company could buy back shares as a short-term measure to help win back investor confidence.

Shares in Syngenta rose five percent to 325 Swiss francs on Thursday, having plunged 18 percent in the previous session when U.S. seeds giant Monsanto Co. (MON.N: Quote) abandoned its pursuit of a deal.

Monsanto had been prepared to pay a headline price of 470 Swiss francs per share, valuing the company at $47 billion.

Since the price would have been partly paid in Monsanto shares, which have dropped, the package would have been worth 433 francs per share by Tuesday's closing price, according to Syngenta.

Analysts at Zuercher Kantonalbank said the gap between the current share price and bid proposal could force the hand of Syngenta management.

"The pressure from Syngenta shareholders will arguably build up quickly to pursue changes that increase value. These could be announced soon," they said in a note.

Syngenta said in a statement on Wednesday it was committed to accelerating shareholder value creation. A spokesman said the company would not provide specific comments on measures to be taken.   Continued...

Flowers grow in front of Swiss agrochemicals maker Syngenta's logo at the company's headquarters in Basel August 19, 2015. REUTERS/Arnd Wiegmann