|
ICI-DuPont deal collapses
|
 |
January 4, 1999: 7:33 a.m. ET
U.S. antitrust authorities nix $727m chemicals sale
|
LONDON (CNNfn) - Shares in Imperial Chemical Industries tumbled in London trading Monday, after the heavily indebted group said plans to sell a subsidiary had collapsed.
ICI also announced a revamp of some of its units leading to a reduction in its workforce by about 1,000, with half of them in the U.K. ICI now employs 67,500.
ICI had agreed to sell its Tioxide business to DuPont (DD) for 445 million pounds ($727 million). However, U.S. antitrust authorities intervened, demanding substantial asset disposals before the deal could proceed.
ICI (ICI) shares sagged nearly 5 percent to 499 pence in London, as analysts factored in the bad news. The group has a debt mountain of 4.4 billion pounds ($7.2 billion), and was relying on disposals to provide the cash to pay off that debt.
ICI is examining its options with regard to Tioxide, with one possibility being floating the business on the market.
Last year ICI suffered a similar blow when the Federal Trade Commission blocked the sale of its Crosfield subsidiary to W.R. Grace (GRA).
"The latest setback is not that much of a surprise given that the deal has been tied up with the FTC for about 18 months," said one analyst. "Investors are concerned because the disposal program is a key part of ICI's strategy." .
|
|
|
|
|
 |
|
