Bloomberg

(Bloomberg) -- China National Chemical Corp. is nearing approval from U.S. national security officials for its $43 billion takeover of Swiss chemical company Syngenta AG, according to a person familiar with the matter.

The companies plan to make an announcement as soon as this week after getting clearance from the Committee on Foreign Investment in the U.S., said the person, who asked not to be identified because the review is confidential.

Syngenta, which got more than a quarter of its revenue last year from seeds and crop protection in North America, would help transform state-owned ChemChina into a global pesticide and agrochemical giant. The bid is leading a record wave of Chinese acquisitions that has prompted U.S. officials to consider claims that some purchases could threaten national security.

CFIUS, which is led by the Treasury Department and includes officials from the Defense and State departments, reviews acquisitions of U.S. businesses by foreign investors for risks to American security and can recommend to the president that deals be blocked. The committee often imposes conditions on transactions before clearing them, such as restricting the foreign company’s access to parts of the U.S. business. 

Close Scrutiny

Reuters reported the expected clearance earlier, citing unidentified people. A representative for ChemChina declined to comment. A spokeswoman for Syngenta reiterated the company expects the deal to close by year-end and declined to comment further. 

A spokeswoman for the U.S. Treasury Department didn’t immediately respond to a request for comment outside regular office hours in Washington. The committee’s reviews are confidential, and the department doesn’t comment on them.

Approval by CFIUS may trigger criticism in the U.S. A group of farm-state senators in March called on Treasury to closely scrutinize the Syngenta takeover, saying it could affect food security and safety as well as the U.S. farm sector. 

In June, Senator Chuck Grassley, a Republican from Iowa, called the deal “concerning” and said the U.S. needs to consider “strategic questions” before approving the sale of agricultural assets to foreign governments.

--With assistance from Prudence Ho To contact the reporter on this story: David McLaughlin in Washington at dmclaughlin9@bloomberg.net. To contact the editors responsible for this story: Sara Forden at sforden@bloomberg.net, Ben Scent, Young-Sam Cho

©2016 Bloomberg L.P.

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