Agreement will combine strengths of China Seed's and Monsanto's corn seed
businesses to deliver higher yielding corn seed hybrids to Chinese farmers.
BEIJING and ST. LOUIS, Aug. 21 /PRNewswire-FirstCall/ -- Monsanto
Company (NYSE: MON), a global agricultural company, and China National Seed
Group Corporation (CNSGC) have entered into an agreement to expand their
investments in the companies' existing Chinese joint venture company. The
agreement is subject to approval by Chinese government authorities.
"We are very pleased to announce the signing of an agreement that will
greatly strengthen our collaboration with Monsanto," said Zhang Zhiyin,
vice president of Sinochem Corporation, parent of CNSGC. "China Seed is
dedicated to delivering the highest yielding seed to Chinese farmers and we
believe a broader joint venture with Monsanto will enable our business to
expand our offerings to Chinese farmers."
"We are pleased to increase our collaboration with China Seed to
deliver elite corn hybrids to farmers within the world's second-largest
corn-growing region," said Brett Begemann, executive vice president of
Monsanto. "This investment signals a new strategic emphasis for our
business in China and a new growth opportunity for our international corn
seed business. We are excited about the potential that our combined efforts
can have in improving farm productivity, increasing farmer incomes and
helping Chinese farmers to meet both China's and the world's growing demand
for grain."
This agreement between China Seed, a wholly-owned subsidiary of
Sinochem Corporation, and Monsanto Far East Limited, a wholly-owned
subsidiary of Monsanto Company, will increase their investment in
CNSGC-DEKALB Seed Company Ltd. ("CNDK"), an existing joint venture company
formed in 2001. The investments will enable CNDK to expand its existing
corn seed business, by combining CNDK's business operations with the corn
seed business of China Seed and providing CNDK access to elite corn seed
hybrids developed by Monsanto and China Seed.
China is the world's second largest corn growing region. Chinese
farmers annually plant approximately 27 million hectares, or 67 million
acres, to the crop. Once approved by Chinese Government authorities, the
joint venture is expected to enable China Seed to expand its product
offerings to local farmers across all four corn-growing areas, well beyond
the tropical region where the company currently operates.
Under the agreement, China Seed will contribute its existing corn seed
business assets and Monsanto will contribute 575 million RMB (approximately
$84 million US) to the joint venture. China Seed will continue to hold a
fifty-one percent ownership interest in CNDK while Monsanto will continue
to hold a 49 percent ownership interest in the joint venture. Additional
details of the agreement have not been disclosed at this time.
China Seed, which is recognized as a leading enterprise within the
agricultural industry in China, was first established in 1978. The seed
business has been awarded twice the No. 1 ranking among the top fifty seed
companies in China. China Seed became a wholly-owned subsidiary of Sinochem
Corporation in June 2007. Today, the company focuses on the development of
three key crop businesses: corn, rice and vegetables. To learn more visit:
http://www.chinaseeds.com.cn or http://www.chinaseeds.com.cn/english.
About Monsanto Company
Monsanto Company (NYSE: MON) is a leading global provider of
technology- based solutions and agricultural products that improve farm
productivity and food quality. Monsanto remains focused on enabling both
small-holder and large-scale farmers to produce more from their land while
conserving more of our world's natural resources such as water and energy.
To learn more about our business and our commitments, please visit:
http://www.monsanto.com.
Monsanto Company Cautionary Statements Regarding Forward-Looking
Information:
Certain statements contained in this release are "forward-looking
statements," such as statements concerning Monsanto's anticipated financial
results, current and future product performance, regulatory approvals,
business and financial plans and other non-historical facts. These
statements are based on current expectations and currently available
information. However, since these statements are based on factors that
involve risks and uncertainties, the company's actual performance and
results may differ materially from those described or implied by such
forward-looking statements. Factors that could cause or contribute to such
differences include, among others: continued competition in seeds, traits
and agricultural chemicals; the company's exposure to various
contingencies, including those related to intellectual property protection,
regulatory compliance and the speed with which approvals are received, and
public acceptance of biotechnology products; the success of the company's
research and development activities; the outcomes of major lawsuits;
developments related to foreign currencies and economies; successful
operation of recent acquisitions; fluctuations in commodity prices;
compliance with regulations affecting our manufacturing; the accuracy of
the company's estimates related to distribution inventory levels; the
company's ability to fund its short-term financing needs and to obtain
payment for the products that it sells; the effect of weather conditions,
natural disasters and accidents on the agriculture business or the
company's facilities; and other risks and factors detailed in the company's
most recent report on Forms 10-Q and 10-K. Undue reliance should not be
placed on these forward-looking statements, which are current only as of
the date of this release. The company disclaims any current intention or
obligation to update any forward-looking statements or any of the factors
that may affect actual results.
SOURCE Monsanto Company
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Related links:
http://www.monsanto.com
http://www.chinaseeds.com.cn/
http://www.prnewswire.com/comp/114341.html/
CONTACT:
Lucy Sun of Monsanto China, +86-10-58290764;
or Lee Quarles of Monsanto USA, +1-314-694-2330
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