Bayer CropScience LP in the United States and Bayer CropScience Inc. in Canada today signed agreements to purchase Crompton Corp.’s 50 percent share of the Gustafson seed treatment business in the United States, Canada and Mexico for the purchase price of $124 million in cash. The action would give Bayer CropScience, which already holds a 50 percent share of the U.S. and Canadian Gustafson joint ventures, full ownership of Gustafson’s NAFTA business, subject to customary closing conditions. The transaction is expected to close by the end of the first quarter.
Gustafson manufactures and markets seed treatment products and related equipment. Based in Plano, Texas, and Calgary. Canada, the company employs approximately 250 people in the NAFTA region. In 2003. Gustafson sales were approximately $130 million.
“Purchase of the Gustafson seed treatment business would allow us to participate directly in this increasingly important segment of the NAFTA crop protection markets,” said Emil Lansu, president and CEO of Bayer CropScience LP and head of Bayer CropScience for the NAFTA region.
According to Lansu, the acquisition would give Bayer CropScience the benefit of the full range of Gustafson’s products, including certain products from third parties, which would continue to make up a key component of the Gustafson product portfolio.
“We presently have several strong seed treatment products,” Lansu added. “With the Gustafson purchase we look to more fully realize the potential of this business while enhancing our ability to provide solutions for growers.”
Crompton will continue to participate in the global seed treatment business. In the NAFTA region, the company will supply its seed treatment products through the Bayer CropScience-Gustafson business. Crompton’s seed treatment business outside of NAFTA will be unaffected by the transaction.
“We remain committed to our worldwide crop protection business, including its important seed treatment segment and to providing the technologically advanced solutions our customers have come to expect,” said Robert L. Wood, Crompton’s president and chief executive officer. “The proceeds from this transaction will be used to further our goal of ongoing debt reduction.”
Bayer CropScience LP is the U.S. business of Bayer CropScience, which has its global headquarters in Monheim, Germany. Bayer CropScience, a subsidiary of Bayer AG with annual sales of about EUR 5.8 billion (2003), is one of the world’s leading innovative crop science companies in the areas of crop protection, non-agricultural pest control, seeds and plant biotechnology. Bayer CropScience has a global workforce of about 19,000 and is represented in more than 120 countries, ensuring proximity to dealers and consumers.
Crompton Corp., with annual sales of $2.2 billion, is a producer and marketer of specialty chemicals and polymer products and equipment. Additional information concerning Crompton Corporation is available at www.cromptoncorp.com.