Syngenta wins Shanghai Exchange approval for 65 billion yuan IPO

SYNGENTA Group has won the Shanghai stock exchange’s approval for its 65 billion yuan (US$9.1 billion) initial public offering (IPO), moving the world’s biggest potential listing this year a step closer to completion.

The Chinese-owned seed giant received the green light following a hearing on Friday (Jun 16), according to a statement from the exchange.

The approval will come as a relief to the Swiss-headquartered firm’s owner Sinochem Holdings. Syngenta has been working on the listing since at least 2019, two years after it was acquired for US$43 billion in China’s biggest foreign takeover to date.

A previous hearing for an application by Syngenta to debut on Shanghai’s Star board was abruptly cancelled in March, shocking Syngenta’s executives and advisers. The application was withdrawn and resubmitted last month for a listing on the main board.

The company plans to use proceeds from the IPO for high-end agricultural technology research, global acquisitions and long-term debt repayment as well as business expansion and upgrades, it said in a filing last month.

China has shifted responsibility for vetting the eligibility of IPO candidates to the exchanges, as part of reforms aimed to to speed access to funding in the nation’s US$10.3 trillion equity market. Regulators earlier this year moved to expand a registration-based system for listings on all exchanges beyond the Star board.

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While global IPO volumes in the year to date are down 17 per cent compared to the same period in 2022, listings in China account for US$32 billion, about half of the worldwide total, according to Bloomberg calculations. Chinese banks have taken the top five slots in the global underwriting league tables so far this year.

Syngenta’s sales rose to US$9.2 billion in the three months ending in March, a 3 per cent increase from the same period in 2022. The company said the growth of its crop protection businesses was slower after exceptionally strong quarters in the prior two years. Its China operations were robust, with sales jumping 26 per cent from a year ago to US$3 billion.

China National Chemical, known as ChemChina, acquired Syngenta in 2017. Sinochem absorbed ChemChina in 2021, and Syngenta subsequently incorporated Sinochem’s agricultural business.

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China International Capital and BOC International Holdings are sponsors of the planned share sale. BLOOMBERG