DuPont snaps up polyester and Tioxide businesses from `reshaped' ICI
15 Jan 2000
ICIhas achieved a major part of its goal to dispose of its bulk chemicals businesses, by selling most of its white pigments division, Tioxide, its polyester polymer and intermediates business, and the Melinex polyester film concern to its USrival, DuPont. The deal will net ICI a total of $3billion (some £1.8billion).
The divestment is part of ICIchairman Charles Miller Smith's plan to `create a new ICI for the new century', shifting the company from bulk to speciality and consumer chemicals. The proceeds will help pay off the £3billion debt he incurred in buying Unilever's speciality chemicals business (see PE June 97, p12). Other recent divestments will also reduce the debt: the £1billion gained from selling its 62.4 per cent stake in ICI Australia, and a deal whereby it sold its Millbank head office to the Prudential and leased it back, netting it another £120million.
The businesses bought by DuPont include PTAand PEToperations in the UKand US, along with a 70 per cent stake in a PTAjoint venture in Taiwan; Melinex polyester films businesses in the US, UK, Netherlands and Japan; and the Tioxide group's companies in Europe, Malaysia and South Africa. Tioxide was to be floated as a separate company, but because of regulatory concerns, DuPont opted not to buy the business's US and Canadian operations. These will be sold separately - in `weeks or months rather than years,' according to finance director Alan Spall - and if they fetch less than $150million, DuPont will pay up any deficit. Together, these businesses generated a trading profit of £17million in 1996, on sales in the region of £1.45billion.
Although ICIhas now almost achieved its stated goal for its disposals programmes - £3billion over three years - in just two months, Miller Smith intends to keep reshaping its portfolio. There are now only a few remaining industrial chemicals operations, including petrochemicals, chlor-alkali and methanol, left for him to sell.
