The Hindu Business Line : ICI India to sell adhesives biz to Henkel’s Indian arm

In a communication to the stock exchanges, ICI India has said that its board of directors on Friday decided to sell the adhesives business as a going concern. The company will seek its shareholders’ approval for this proposal. The total amount is subject to agreed adjustments for actual working capital and cash balances.

Global restructuring

ICI India’s move follows a global restructuring of its business. Following Akzo Nobel NV becoming the owner of 100 per cent of the share capital of ICI UK, Akzo has finalised the sale of ICI’s global adhesives and electronic materials business to Henkel AG.

The adhesives business of ICI India, the communication said, was closely integrated with the global adhesives business of the ICI group.

ICI India had established its adhesives business in 1997. It has a manufacturing site at Thane in Maharashtra and the net sales revenue from the business for the year ending March 31, 2007 was Rs 135 crore. ICI India had also acquired a 67 per cent stake in Polyinks Ltd, which has a manufacturing facility in Hyderabad and is in the process of setting up a plant at Rudrapur in Uttarakhand. For the year ended March 31, 2007, Polyinks had a net sales turnover of Rs 14 crore.

According to the communication, the business proposed to be transferred to the Henkel group will include its portion of Thane manufacturing facility and about 120 employees and the company’s shareholding in Polyinks. The transaction is likely to be completed in the second half of 2008.

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