European Union antitrust regulators opened  on Friday the second phase of its investigation about the proposed takeover of Swiss-based Syngenta AG by Chinese state-owned ChemChina. This means the fate of the multibillion dollar deal will now be decided next year.

Like Us on Facebook

Syngenta's chief executive officer Erik Fyrwald already confirmed on Tuesday that the deal has been extended till the first half of 2017.

Justifying the second phase of investigation, EU regulators said the takeover could adversely affect the competition in the region through its subsidiary firm Adama Agricultural Solutions (ADAM.N). It claimed that the firm had overlapping portfolios in the production of crop protection products, such as herbicides, insecticides, fungicides and plant growth regulators.

"This deal would lead to the combination of a leading crop protection company with one of its main generic competitors," said Margrethe Vestager, EU Competition Commissioner. "Therefore we need to carefully assess whether the proposed merger would lead to higher prices or a reduced choice for farmers." 

The regulator will now decide whether or not to approve the deal by March next year.

ChemChina has reportedly said it is ready to offer more concessions to EU clinch the multi-billion dollar deal.

EU's hesitance in giving a fast approval to Chemchina- Syngenta deal has surprised many, given that the mega deal was approved by US regulators in August without any major conditions.

Meanwhile, Mr. Fyrwald clarified to Reuters on Tuesday that the deal is not effected by talks of possible merger between ChemChina and Chinese peer Sinochem.

"We talk to ChemChina regularly on a range of issues, as you can imagine, and they have repeatedly assured us that they are not in any discussions about merging with Sinochem," Fyrwald said via a telephonic interview.

The successful takeover of Syngenta is immensely crucial for ChemChina's longstanding global ambitions. The takeover, which would cost ChemChina $43 billion, is the largest foreign direct investment by a Chinese firm till date. 

TagsChemChina, syngenta, ChemChina Syngenta Deal, china