Companies

ChemChina seeks price reduction for MA Ind stake

(Agencies)
Updated: 2010-11-22 13:29

TEL AVIV, Israel - China National Chemical Corp (ChemChina), which is in talks to buy MA Industries, is seeking a lower price for the world's No 7 agrochemical maker, which had warned it would report a wider quarterly loss this week.

State-run ChemChina is seeking to set the valuation for Israel's MA at $2.40 billion instead of the $2.72 billion originally discussed, MA's parent company Koor Industries said in a statement on Sunday.

The new price reflects a share price of 20.3 shekels ($5.58)?for MA, which makes herbicides, fungicides and insecticides. Its stock was down 6.9 percent to 16.62 shekels in early afternoon trade. Koor shares were down 4.3 percent.

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The two sides are also discussing ChemChina buying a smaller stake from Koor than originally planned, the statement said.

Last month the two sides discussed ChemChina taking 70 percent of MA, including 17 percent purchased from Koor, which would have retained 30 percent.

But Koor, which also owns 3.24 percent of Credit Suisse, now says it might retain more than 30 percent of MA, though it did not specify the amount.

Under the agreement being discussed, ChemChina would buy all of the publicly traded shares and would delist MA, which competes with Monsanto, Bayer and Syngenta.

China is looking for opportunities to grow in the global agricultural chemicals market by buying up production and distribution capabilities -- areas that would cost a lot of money and take time to develop domestically.