Sale of specialities subsidiary stimulates split speculation
15 Jan 2000
The management buyout of Zeneca Specialties from the recently-merged AstraZeneca has fuelled speculation that the Anglo-Swedish bioscience firm may be preparing to sell off its agrochemicals division. Such a move would position AstraZeneca as a purely pharmaceuticals player, and distance it from controversy surrounding the agribusiness's GM food interests.
The specialities division was funded by the investment groups Cinven and Investcorp, which stumped up £1.3billion between them. The businesses netted £686million in sales last year, with operating profits of £90million and net assets worth £460million. The deal should be completed this month.
The current chief executive of Zeneca Specialties, Jeremy Scudamore, will continue as chief executive of the new firm. `The business has been performing particularly well as a result of recent restructuring,' he comments.
AstraZeneca has refused to comment on the speculation over the sale of the agrochemicals businesses. Although it is the third-largest such business in the world, worth some £3billion, it is a minor part of AstraZeneca, accounting for only 10 per cent of operating profits. Moreover, it is subject to dramatic fluctuations in fortunes depending on the weather in its target markets.
