ICI India resorts to recast plan

Chennai:
26 September 2003

The company, towards this end, will focus only on four business segments — paints, industrial starch, speciality chemicals, and flavours and fragrances — through Quest Flavours and Fragrances.

ICI India will exit from explosives, nitro-cellulose and rubber chemicals business lines. "We are negotiating with various parties to sell the rubber chemicals and nitro-cellulose businesses," says ICI India managing director Rajiv Jain.

ICI India has agreed to divest the balance 51-per cent in Indian Explosives to Orica Investment, Australia. Sometime back the company sold the 49-per cent stake to the Australian company. The total sale deal works out to Rs 166 crore.

For the past couple of years ICI India has been in news for exiting and buying businesses. ICI India sold its pharmaceutical division to Nicholas Piramal India, the 50-per cent stake in Berger Auto & Industrial Coating to the joint venture partner Berger Paints India, the polyurethanes business to the Huntsman group, USA, and the catalysts business to the Johnson Matthey group, UK.

"We were not successful in bringing in new technology," reasons Jain for exiting different business segments. The company bought a majority share in Quest International India, a joint venture with Hindustan Lever. "Negotiations are on to buy out Hindustan Lever''s balance stake."

According to Jain, ICI plc is open to acquire the 10-per cent stake held by the Indian government in ICI India. With a cash kitty of around Rs 300 crore raised from the sale of business, Jain is seeking acquisitions that will fit the company''s new business plan.