Printer Friendly

ICI CONSIDERING DEMERGER PROPOSALS

 ICI CONSIDERING DEMERGER PROPOSALS
 NEW YORK, July 30 /PRNewswire/ -- Imperial Chemical Industries PLC


(NYSE: ICI) announced today that it is considering proposals which, if implemented, would lead to the division of the group into two separate public companies: ICI and ICI Bioscience PLC (ICI Bio).
 The division would be effected by the demerger by ICI of its bioscience interests to create a new publicly listed company, ICI Bio, the shares of which would be distributed to ICI shareholders. The division would be designed to enhance the ability of each of the two business groups to meet the very different challenges they are facing, to the benefit of customers, shareholders and employees. Consideration would also be given to ICI Bio, subject to market conditions, raising new equity capital about the same time as the demerger, by way of a public offer. A demerger would involve numerous complex legal and financial restructuring steps in many of the countries in which the group operates.
 In consequence, no decision to implement these proposals has been taken or is expected to be taken until after the publication of ICI's 1992 preliminary results in February 1993. Any decision would be taken in the light of market and other conditions prevailing at the relevant time. If, however, such a decision were taken, all appropriate consents and approvals would be sought and formal proposals would be put to ICI's shareholders. For accounting purposes the division would, as far as practicable, take effect from Jan. 1, 1993.
 -- ICI would comprise its existing paints, materials, industrial chemicals and explosives businesses and the surfactants business of ICI Specialties.
 -- ICI Bio would comprise ICI's existing pharmaceuticals, agrochemicals, seeds and the specialty chemicals businesses.
 -- The chairman of ICI, Sir Denys Henderson, would be chairman of both ICI and ICI Bio, but each would have its own chief executive.
 -- R.C. Hampel would be deputy chairman and chief executive of ICI.
 -- J.D.F. Barnes would be chief executive of ICI Bio.
 The chairman of ICI said, "I am sure it is right for us to consider a strategic move of this kind now. I believe that the grouping of core businesses now being contemplated by the ICI board would enable each company, post separation, to respond better to economic circumstances and to the major changes facing the chemical and pharmaceutical industries. Even more importantly, the skills, energy and determination of their employees would be more effectively deployed to capture the considerable global opportunities which will develop as the 21st century approaches. Shareholders, employees and customers would all benefit from the proposed new structure."
 "Each group would have different characteristics and would be free to develop its strengths in ways which its management judges most appropriate to maintain good, profitable growth and a leading, cost- effective, competitive position in its particular business sectors. Above all, the board of each company would focus more selectively on the preferred opportunities within the new groupings, while continuing to restructure its cost base in line with specific business needs."
 Background
 Since its formation in 1926, ICI has played a leading role in the world chemical industry. In that period the industry has spawned many new business areas and has become truly international.
 In recent years ICI's bioscience businesses have developed rapidly and in 1991 had a turnover of 3.9 billion pounds sterling. They are however, becoming increasingly distinct from ICI's other operations, employ different technologies and serve a largely separate customer base.
 ICI's other businesses are for the most part capital intensive, based on large scale process technology and are volume driven. The bioscience businesses are more R&D intensive with highly focused products.
 Consideration of the proposals has now reached the point were the board decided it was appropriate that shareholders, customers, suppliers and employees should be aware of its deliberations. This will also facilitate completion of the work which needs to be done before the board is in position to take the decision whether to put the proposals to shareholders.
 The Proposals
 The proposals being considered contemplate that, on demerger, for each ICI share held, a shareholder would also receive a share in ICI Bio. Consideration would also be given to ICI Bio, subject to market conditions, raising new equity capital about the same time as the demerger by way of public offer.
 This would create two major international companies, each of which would be well capitalized and able to pursue science-based growth opportunities.
 Information on ICI and ICI Bio
 ICI would comprise a coherent group of global businesses with leading positions in paints, explosives and titanium dioxide; in specific materials such as polyurethanes, acrylics and polyester film; and with global strengths in CFC replacements, polyester intermediates, surfactants and catalysts. It would also have good regional market positions in olefines and derivatives, aromatics, chlor-alkali products and derivatives. This extensive but focused range of products is well supported by an integrated manufacturing chain, which draws to a significant extent on the inter-business supply of key raw materials and intermediates. Most of the businesses are relatively high volume and capital intensive, with similar needs in chemical engineering and capital project managements. They also share a strong technology base in polymer science, colloid science, materials and composite technology, and heterogeneous catalysis. They are particularly skilled in the operation of complex chemical plants requiring sophisticated process technology and engineering.
 ICI Bio would comprise ICI's international ethical pharmaceuticals, agrochemicals and specialty chemicals businesses, including the growth opportunities in hybrid seeds, foodstuffs, fine chemicals and biodegradable polymers. These businesses, which are all research and technology intensive, have extensive international development and marketing skills, and have a strong common science base in synthetic organic chemistry, biology, biotechnology, and customer specific product formulations. They also share scientific software systems facilitating molecular design, analysis and synthesis. An important strength is the group's Fine Chemicals Manufacturing Organization which provides a cost- effective process technology and manufacturing capability for all these businesses.
 Set out in the following appendix, for each of ICI and ICI Bio, are approximate 1991 sales and operating profits by division and numbers of employees. These figures are extracted from the 1991 published annual report as a guide only.
 Advisors
 ICI is being advised in relation to the proposals by S.G. Warburg & Co. Ltd. and S.G. Warburg Securities.
 Appendix
 Operating Statistics
 The following abridged figures, for turnover and trading profit, have been extracted from the 1991 annual report and have been adjusted only to reclassify the turnover and trading profit of surfactant from ICI Bio to ICI and to eliminate the estimated turnover between businesses with ICI. The information below is not intended to constitute pro forma figures for the separate ICI and ICI Bio businesses and certain intergroup reclassifications and other adjustments may be necessary.
 ICI
 (In millions of pounds sterling)
 Trading
 Turnover Profit Employees
 1991 1991 at 12/31/91
 Paints 1,588 118
 Explosives 536 54
 Materials 2,037 (20)
 Industrial chemicals
 (including surfactant) 3,894 132
 Regional 1,246 29
 Sales eliminations (600) --
 Total 8,701 313 88,100
 ICI BIO
 (In millions of pounds sterling)
 Trading
 Turnover Profit Employees
 1991 1991 at 12/31/91
 Pharmaceuticals 1,588 538
 Agrochemicals and seeds 1,365 144
 Specialties
 (excluding surfactant) 984 38
 Total 3,937 720 35,500
 Sales eliminations (150) --
 Total per ICI annual report 12,488 1,033 123,600
 North American 1991 Statistics
 Sales Employees
 ICI (US$ millions)
 Paints $1,031.0 5,898
 Explosives 498.7 3,440
 Materials 1,219.5 3,250
 Industrial chemicals
 (including surfactants) 581.5 1,251
 Regional 138.5 365
 Sales eliminations (199.8) --
 Total 3,269.4 14,204
 ICI Bioscience
 Pharmaceuticals $1,304.7 2,918
 Agrochemicals and seeds 828.3 2,284
 Specialties
 (excluding surfactants) 677.4 2,638
 Corporate -- 1,284
 Sales eliminations (25.9) --
 Total ICI Bioscience 2,784.5 23,328
 Total 6,053.9 --
 Research & development spending 279 (U.S.)
 6.2 (Canada)
 -0- 7/30/92
 /CONTACT: Pat Preston (media), 212-644-9265, or Vincent Leheny (investors), 212-644-9274, both for ICI
 (ICI) CO: Imperial Chemical Industries PLC ST: New York IN: CHM SU:


KD-CK -- NY028 -- 5072 07/30/92 11:54 EDT
COPYRIGHT 1992 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Jul 30, 1992
Words:1360
Previous Article:GTE CALIFORNIA PARTNERS WITH INLAND EMPIRE ECONOMIC COUNCIL TO BRING BUSINESS TO INLAND EMPIRE
Next Article:COMPUTER LANGUAGE RESEARCH AND RESEARCH INSTITUTE OF AMERICA ANNOUNCE EASYGO WITH ONPOINT
Topics:


Related Articles
EPA HONORS ICI WITH STRATOSPHERIC OZONE PROTECTION AWARD
ICI HERBICIDE IS POTENTIAL TREATMENT FOR RARE MEDICAL DISORDER
ICI INTERNAL SPLIT TAKES EFFECT
/FIRST AND FINAL ADD -- NY028 -- IMPERIAL CHEMICAL INDUSTRIES INTERNAL SPLIT TAKES EFFECT/
ICI BOARD TO RECOMMEND ZENECA DEMERGER TO BE READ WITH 1992 RESULTS RELEASE
IMPERIAL CHEMICAL INDUSTRIES PLC ZENECA DEMERGER APPROVED AT EXTRAORDINARY GENERAL MEETING
IMPERIAL CHEMICAL INDUSTRIES PLC REPORTS 1993 HALF YEAR RESULTS
IMPERIAL CHEMICAL INDUSTRIES PLC 1993 FOURTH QUARTER AND FULL YEAR RESULTS
ICI suitor ups offer to pounds 8bn; In association with RBS.
Crown takes peek at those Dulux books; In association with RBS.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters