Switzerland based agricultural products company, Syngenta AG (SYT - Analyst Report), recently entered into a strategic pact with E. I. du Pont de Nemours and Company (DD - Analyst Report). The new deal allows the companies to use each other’s technologies. The transaction is subject to regulatory approvals. Also, the financial terms of the deal are not yet announced.
Per the terms of the agreement, Syngenta is allowed to use DuPont’s fungicide oxathiapiprolin for its own products. This technology is useful for developing products needed to control diseases in grapes, potatoes, vegetables and other crops.
Also, Syngenta will be entitled to use foliar and soil for all the crops in the North American region as well as global usage in the lawn and gardens segment.
In exchange, DuPont will be able to take the advantage of Syngenta’s Solatenol, to be mixed with DuPont's picoxystrobin fungicide. The resultant product will be used in the Brazilian region on soybeans and other crops. Solatenol is presently used in controlling Asian rust in soybeans.
This deal, subject to approvals, will enhance both the companies’ product portfolio along with gaining a higher market share. It will also be beneficial to Syngenta since it will increase the sale of Solatenol in Brazil. Moreover, DuPont will benefit from the deal as it will be in a better position to offer profitable products to its customers, thereby increasing demand and sales.
Syngenta currently carries a Zacks Rank #4 (Sell). Other stocks worth a look in the industry are Monsanto Company (MON - Analyst Report) and Braskem S.A. (BAK - Snapshot Report), both carrying a Zacks Rank #2 (Buy).