Syngenta Group says it won't go public on Shanghai's main market this year due to unfavorable market conditions.
The announcement last week is another setback in the company's long effort on an initial public offering (IPO). Syngenta had hoped to raise 65 billion Chinese yuan ($8.93 billion), which would have been the largest IPO globally this year, according to Dealogic data.
“Given weak market conditions we expect that the company will IPO by the end of next year,” a Syngenta spokesperson said. “We will also remain flexible in our approach and explore alternative methods to expanding our shareholder base.”
In May, Syngenta announced it would no longer pursue a listing on China's Nasdaq-style STAR Market. Instead, it planned to go public on the main market at the Shanghai Stock Exchange.
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Last month, Syngenta revealed changes to its leadership team, appointing Jeff Rowe as the new CEO and Hengde Qin as the CFO. Rowe will start in January, Qin in December. Rowe, currently in charge of Syngenta's crop-protection business, will take over from Erik Fyrwald, who has been the CEO since June 2016, predating the acquisition of Syngenta by ChemChina in 2017.
The news of Syngenta's IPO delay coincided with the company reporting lower earnings and revenue for the third quarter compared to exceptionally strong results a year ago. The decline was attributed to a significantly weaker market in Brazil and industrywide reductions in inventory. The company, headquartered in Basel, Switzerland, stated that EBITDA — earnings before interest, taxes, depreciation and amortization — for the quarter dropped by 68% to $300 million, and quarterly sales fell by 13% to $6.8 billion.
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