Makhteshim-Agan: Big Move Coming?
8 October 2007 The leading generic agrochemical company hinted at a “company transforming” deal, according to the article. “That’s why we did the bond issue last year, so we are well-positioned in the market from a financial point of view once the right opportunity comes up,” Makhteshim CEO Avraham Bigger told The Jerusalem Post.
MAI is looking into opportunities as part of its acquisition strategy. “Generally speaking, there is huge volatility in the markets discouraging private equity activity and a lack of financial means, but we can see opportunities for companies to be sold because of the good feeling in the industrial sector, and we are willing to pay a premium that could be financed by synergies,” Bigger said.
“The US market is a very competitive market and we want to increase our market share in Eastern Europe and in particular in the Far East, where our presence has not been strong enough,” he continued. He declined to comment on recent reports that said MAI was in the running to acquire Japanese crop protection and life sciences firm Arysta LifeScience Corp. in a US $2 billion deal.
It is believed that other prospective bidders in the race to buy Arysta from private equity firm Olympus Capital Holdings include India’s United Phosphorus Ltd. (UPL) and Australia’s Nufarm Ltd.
Other reports last month claimed that MAI might be considering an acquisition of Nufarm, the world’s second largest generic agrochemicals maker, with a market capitalization of SU $2 billion. MAI has a $3.5 billion market cap.
Considered in the industry as a serial corporate restructurer with a history of doing major deals, some believe Bigger may be just the man to make such a move. Not all analysts saw the picture that way, however.
“Makhteshim Agan is much more likely to be gearing up to buy additional product lines. Dow Chemicals and DuPont are expected to spin off parts of their businesses, which could be of strong interest to Makhteshim Agan,” a Tel Aviv analyst said.
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