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FMC to Buy DuPont Assets Including Insecticide and Cereal Herbicide Businesses

It’s part of a European Commission divestment ruling for the planned Dow-DuPont merger. In return, DuPont gets FMC Health and Nutrition and $1.2 billion.

FMC is expanding its footprint in the agricultural insecticide and herbicide business through a purchase from DuPont. In exchange, DuPont is acquiring FMC Health and Nutrition.

It’s all part of a European Commission divestment ruling related to DuPont’s merger with The Dow Chemical Company. 

Here’s what’s happening 

FMC will acquire DuPont’s global chewing pest insecticide portfolio, its global cereal broadleaf herbicides, and a substantial portion of DuPont’s global crop protection R&D capabilities. After closing of the acquisition, FMC Agricultural Solutions will become the fifth-largest crop protection chemical company in the world by revenue, with estimated annual revenue of approximately $3.8 billion.

Meanwhile, DuPont is acquiring FMC Health and Nutrition and will also receive $1.2 billion in cash as part of the deal.

What FMC Gets

According to an FMC news release, the acquired portion of DuPont’s crop protection business includes a selective insecticide portfolio consisting of Rynaxypyr, Cyazypyr, and Indoxacarb. The first two of these products have full patent protection over their respective active ingredients, and FMC expects these products will generate over $1 billion in 2017 revenue. These selective insecticides are complementary to FMC’s existing broad-spectrum insecticide portfolio.

The acquired portfolio also includes DuPont’s global cereal broadleaf herbicides, consisting of nine active ingredients and multiple formulated products. This herbicide portfolio includes recognized brands and DuPont’s proprietary PrecisionPac technology. These products bring diversification to FMC’s crop exposure in herbicides and also increase the balance of preemergent and postemergent applications in FMC’s portfolio, the release said.

The geographic spread of the revenue in this portfolio will result in a significant increase in FMC’s presence in Asia and Europe. Following the acquisition, FMC’s crop protection revenue will be almost equally spread across all four major regions: North America, Latin America, Europe, and Asia.

The underlying intellectual property related to the acquired products, including patents, registrations, and data packages, will be transferred to FMC. FMC will acquire a global manufacturing network to support these products, including four active-ingredient manufacturing facilities and 10 regional formulation plants.

The acquisition will bring DuPont’s discovery and development organization, including its Delaware crop protection research headquarters, 14 regional development labs, and related regulatory capabilities. This organization includes a pipeline of 15 synthetic active ingredients currently in development, covering insecticides, herbicides, and fungicides, and a library of 1.8 million synthetic compounds. The majority of DuPont’s crop protection research workforce will transfer to FMC as part of this transaction.

What’s Next

The transaction is subject to the closing of the Dow and DuPont merger, as well as customary closing conditions and regulatory approvals. Closing is expected to occur in the fourth quarter of 2017.

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