Syngenta: "There are currently no plans to leave Switzerland"

"In China, we will turn over $ 4 billion instead of the previous $ 300 million": Erik Fyrwald on the size advantage of the Syngenta Group. Photo: Samuel Schalch

Syngenta has been in Chinese hands since 2017. The owners made a promise not to relocate the headquarters until five years after the takeover. Will Syngenta stay in Basel after 2021?
Yes. Our new chief financial officer, Chen Liechtenstein, will soon move to Basel. And I live there too. There are currently no plans to leave Switzerland.

There is a lot of speculation about the time of the IPO. How realistic is this in 2021 or 2022?
When we were bought by Chemchina in 2017, the goal was to get us listed on the stock exchange within the next five years. So that would be in the summer of 2022. From today's perspective, we will be able to meet this objective.

Where will the IPO take place - in China or Europe?
We want to go public on two different trading venues. In China and then in the USA or in Europe.

What does this decision depend on?
Of the respective market conditions or the interests of the investors.

How is Syngenta getting ready for the IPO?
At the beginning of January we announced the establishment of the Syngenta Group. In addition to Syngenta, the Israeli Adama Group and the Chinese Sinochem are also involved. We assume that the merger of the new group will be completed at the end of February. This will increase our sales from $ 14 billion to a total of $ 23 billion. In China, instead of the previous $ 300 million, we will generate $ 4 billion. With this, we will finally reach the size it needs in the Chinese market to build a successful business.

Syngenta is heavily in debt. How does the start-up affect debt reduction?
The merger with the Adama Group strengthens our balance sheet. And leads to a lower level of debt.

How deep?
It depends on the size of the IPO.

Cooperation with the Chinese is said to have been difficult after the takeover. According to media reports, the new owners are said to have sucked money out of the company, and there was even talk of a “hollowing out” of Syngenta. What is the relationship like today?
The relationship with Chemchina has been good for the past three and a half years since the sale. The Chinese owners are planning in the long run. 2020 should be a good year for Syngenta. We have been trying to gain a foothold in the Chinese market for a long time. What we have not been able to achieve as requested. Not much has changed even after the takeover by Chemchina. It was only when Frank Ning took over as Chairman of the Board of Directors one and a half years ago that the idea arose to found the Syngenta Group.

Is the Chinese market only now gaining in importance?
Yes, but with sales of $ 4 billion, it will only make up around 20 percent of total business. However, in agriculture, the Chinese market lags far behind global standards. There are many problems with polluted farmland and polluted waters. Because too many fertilizers and chemical substances are used. The farmers' crops and yields shrink. The Chinese government wants us to move agriculture forward. In addition to our main business, Syngenta Group will help local farmers manage their land better.

Brazil was previously an important market for Syngenta. Is that changing now?
No. We have just started the “Reverte” project there, which is intended to offer farmers an alternative to deforestation. We are committed to making arable land in the area of ​​around 1 million soccer fields fertile again. Because in Brazil there is a lot of fallow land that is no longer cultivated. We offer farmers seed that enriches the soil with the right minerals. So the farmer has a good harvest again after five years.

Under President Jair Bolsonaro, deforestation is being pushed forward. Wouldn't the prospect of seed for fertile soil support the clearing?
No, because the arable land is in a completely different part of Brazil than the rainforest. We offer farmers the opportunity to grow where they live. Instead of going north into the Amazon region and clearing forest, they should revive existing land.

The majority of Brazil's farmers are poor, and many of them are unlikely to be able to afford Syngenta's seeds.

We work with local conservation organizations and banks. The banks have agreed to give the farmers a loan that they will only have to repay in a few years. This gives the farmers time to farm their land profitably again.

The thought is good, but why should farmers get into debt and wait five years before they can harvest profitably if they can burn down part of the rainforest for free instead?
So far we have had good feedback from the farmers. They know that with this investment they can secure their future.

Editor's note: This article was originally published in German. This English summary has been prepared with Google Translate and edited for clarity.