ChemChina-Syngenta Deal Faces Investor Concern.docVIP

ChemChina-Syngenta Deal Faces Investor Concern 　　Investors are expressing concern that ChemChina’s proposed $43 billion acquisition of Swiss agribusiness giant Syngenta has run up against new challenges. 　　The current financing structure， based on interviews with people close to the negotiations， as well as private documents seen， indicate uncertainties over who will provide an important piece of funding to the tune of $15 billion， upon which the remainder of funds needed for ChemChina to acquire all Syngenta shares depends. 　　ChemChina’s tender offer made in March indicated a commitment by bank consortiums led by HSBC and Citic to provide initial funding needed to complete the acquisition. The banks are obliged to secure all funds necessary under Swiss law and their contracts with ChemChina’s subsidiaries. Some of this lending is to be replaced by later investments. 　　However， investors say it would be difficult to raise capital for the acquisition if there was not some indication of support from the Chinese government. 　　The sources said the plan is not final， and it may change depending on how Beijing views it. The deal’s success hinges on the Chinese government’s support more than the commitment of funds by banks， said analysts from separate firms in the U.S. that own equity shares in Syngenta. 　　Beijing’s attitude is crucial， but it has been worryingly vague so far， said the analysts. They asked not to be named because neither was allowed to publicly comment on the takeover. 　　One analyst said he’d been looking for clues on whether Beijing may consider the investment unfavorably due to capital flow concerns. 　　For a deal that would be the largest- ever foreign acquisition by a Chinese firm， the country’s giant state-owned banks are notably absent from the group of creditors. 　　China Construction Bank， for one， had expressed interest in joining the Citic consortium， but dropped out later， according to Chinese sources close to the situation. The sour