Thursday, April 15, 1999 Published at 17:03 GMT 18:03 UK
Business: The Company File
Mormon family buys ICI chemicals
How ICI made the announcement on its website
The giant British company, ICI, is selling its industrial chemicals businesses to a Mormon family-owned American firm, Huntsman Corporation.
US based chemical company Huntsman has announced that it will acquire the businesses with a total value of $2.8bn (£1.7bn).
The proceeds will be used to reduce ICI's debts.
The sale will make Huntsman the third largest petrochemical business in the United States after DuPont and Dow and the biggest privately-owned chemical company in the world.
The bid ends ICI's long search for a buyer, after earlier deals were blocked by competition authorities in the United States.
In a press release Huntsman said it would purchase from ICI:
The deal will affect 7,000 workers in 15 countries, including 1,900 in the UK. The businesses being sold have sales of £2bn ($3.2bn) and profits of £120m. UK plants affected include Wilton, North Tees, Billingham, Greatham, Grimsby and Shepton Mallet.
ICI in difficulties
ICI has been trying to exit from the bulk chemicals market for some time, moving into the more profitable speciality chemicals business.
In 1997 it purchased Unilever's food flavourings and fragrance business for £4.5bn ($8bn).
But it has not been able to sell off its bulk chemicals fast enough, leaving it with huge debts and poor profits as the Asian crisis hit its business.
The company employs 67,000 people in 30 countries, making everything from Dulux paint to explosives to plastic films.
ICI says the deal will reduce its debts by £1.3bn, and that is has now sold businesses worth £5.2bn.
It also plans to sell its acrylics business, worth £500m, which Huntsman will have exclusive rights to buy.
Under the terms of the deal, ICI agreed to maintain a £300m stake in a new holding company, to be called HICI, which will purchase the businesses, for a minimum of three years. The new company would also include Huntsman's propylene business, based in Texas.
ICI shares were up 10.5p to 646p on the news.
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