ICI's fertilisers and inorganics hit Terra firma
15 Jan 2000
ICI has sold its fertilisers business, which incorporates most of its inorganic chemicals operations, to US specialist Terra Industries, for £200 million ($340 million). A further £50 million payment may follow. The deal represents Terra's first move into Europe.
The businesses involved are based at Billingham, Teesside, and Severnside, near Bristol. They comprise 740000 tpa of ammonia capacity; 1.2 million tpa of nitric acid; 1.1 million tpa of ammonium nitrate; and 600000 tpa of liquid carbon dioxide. The plants' 580-strong workforce will all be transferred to the new management.
The businesses involved in the deal bring in an average of some £200 million per year in sales, and about £35 million per year trading profit. ICI has attempted to sell these businesses before to Kemira in 1990 but failed after a Monopolies and Mergers Commission ruling.
The business is to be renamed Terra Nitrogen UK, says Terra, which is based in Sioux City, Iowa. The company intends to pump $40 million into the two sites over the next two years, but this will be targeted at increasing storage capacity; there are no plans for production capacity expansions as yet, the company says.
Terra specialises in agrochemicals, particularly crop protection, fertilisers and seeds. It has recently been expanding its operations through acquisitions in Canada in 1993, it bought ICI's Canadian ammonia business but the current deal is its first acquisition outside North America. 'This provides Terra with a significant platform for future international growth,' says chief executive Burton Joyce.
