Zeneca shells out $500 million on Japanese fungicides company
15 Jan 2000
Zeneca has strengthened its commitment to non-pharmaceutical products by spending $500 million (£303 million) on a Japanese-owned, US-based agrochemicals company. Intended to prop up its fungicides business, the acquisition could boost the company to number one in this area.
The company in Zeneca's sights, owned by Ishihara Sangyo Kaisha, a Japanese chemicals manufacturer, posted profits of some $43 million on revenues of $240 million last year. Based in Cleveland, Ohio, it employs some 500 people in North and Latin America, with manufacturing plants near Houston, Texas.
The attraction for Zeneca was that it produces a fungicide called Chlorothalonil. The company intends to sell this product in tandem with its new wide-spectrum fungicide, Amistar. Zeneca is concerned that some fungi might develop a resistance to Amistar; applying it alternately with Chlorothalonil will prevent this from happening, it claims.
According to Zeneca Agrochemicals' chief executive, Michael Pragnell, the acquisition will boost the company to number one in the world fungicides league by the end of the decade, overtaking DuPont, BASF, Bayer, and the Hoechst/Schering joint venture, AgrEvo. The fungicides market is currently worth some $5 billion per year, he points out; a leading position in the fungicides market will be worth a significant portion of that figure.
