KWS Saat to sell China corn business as GMO rules overhauled
31/10/2023 11:04
BERLIN, Oct 31 (Reuters) - German seed producer KWS Saat
KWSG.DE said on Tuesday it will sell its Chinese corn business
due to new regulations that could mean its conventionally bred
traits would be unable to compete with genetically modified corn
over the longer term.
The company said it expects to sell its corn unit and the
corresponding 49% minority stake in joint venture Kenfeng-KWS
Seed to its Chinese partner firm Kenfeng for a mid-range double
digit million euro sum.
The decision was driven by changes in China’s regulatory
framework, a company spokesperson told Reuters.
China has approved genetically modified corn for domestic
companies, but bans foreign companies – including partners in
joint ventures – from developing GMO corn traits.
KWS Saat said without giving further details that it expects
the deal to positively affect its after-tax operating income for
2023/2024.
Kenfeng-KWS Seed was founded as a joint venture in 2014 as
KWS Saat bet on the Chinese corn market opening up to foreign
companies.
With the sale, KWS Saat will largely exit the Chinese
market, where its corn business accounts for about 1% of global
revenue, or about 15 million euros ($15.95 million).
($1 = 0.9406 euros)
(Reporting by Patricia Weiss, Writing by Ferenc Gaal, Editing
by Friederike Heine, Kirsten Donovan)
((Ferenc.Gaal@thomsonreuters.com;))