Brussels to investigate tie-up by AstraZeneca and Novartis
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Your support makes all the difference.The European Commission is today expected to launch an investigation into the proposed merger of the the agribusinesses of AstraZeneca, the Anglo-Swedish drugs group, and Novartis, the Swiss life sciences company.
The referral of the deal, aimed at creating the world's first dedicated global agribusiness, has been expected since the tie-up was announced in December. The groups joined forces in response to a global slump in crop protection industry.
Analysts' concerns have centred on the joint venture's dominance of the fungicide market, where AstraZeneca's Amistar currently competes with Novartis's Flint. The combination would also have a number position on herbicides, and occupy the number two slot in insecticides.
"There are serious concerns that the joint venture would lead to a dominant position in certain product markets," said a Commission spokesman.
A spokesman for Novartis said: "We knew it was going to be complicated and we will work with the Commission to provide as much information as possible. It was never going to be a case of press a button and let's go." An AstraZeneca spokesman said: "We're still expecting to complete in the second half."
The joint venture, to be called Syngenta, had pro-forma sales of $6.9bn (£43bn) in 1998. The drugs groups are looking to demerge the business following completion of the tie-up.
The Commission is obliged to make an announcement on the merger today, which marks one month since the groups filed the deal. A full inquiry into Syngenta's portfolio is expected to take until 4 August.
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