Imperial Chemical Industries (ICI) was a Britishchemical company. It was, for much of its history, the largest manufacturer in Britain.[1] Its headquarters were atMillbank inLondon. ICI was a constituent of theFT 30 and later theFTSE 100 indices.
ICI was formed in 1926 as a result of themerger of four of Britain's leading chemical companies. From the onset, it was involved in the production of various chemicals, explosives,fertilisers,insecticides,dyestuffs,non-ferrous metals, and paints; the firm soon become involved inplastics and a variety of speciality products, including food ingredients,polymers, electronic materials, fragrances and flavourings. During theSecond World War, ICI's subsidiaryICI Nobel produced munitions for Britain's war effort; the wider company was also involved with Britain'snuclear weapons programme codenamedTube Alloys. Throughout the 1940s and 1950s, ICI greatly expanded its activities in thepharmaceutic sector; cumulating in the formation of a dedicated subsidiary,ICI Pharmaceuticals, in 1957.
During 1960, ICI's first outsider to serve as chairman,Paul Chambers, was appointed. Chambers reorganised the company, but fell out of favour following an unsuccessful takeover bid of rival firmCourtaulds. Between 1968 and 1971, Peter Allen was chairman of ICI, during which timeViyella was purchased, the subsidiaryCleveland Potash Ltd was created, and profits dipped. Major moves in the 1970s included the acquisition of the American competitor Atlas Chemical Industries Inc. and the divestment ofImperial Metal Industries. By the late 1980s, ICI which had continued to acquire entities such as the Beatrice Chemical Division and Glidden Coatings & Resins, increasing competition and rising internal complexity were driving ICI towards major restructuring plans, including ademerger.[2]
Considerable changes at ICI came about during the 1990s, particularly in the aftermath of an unsuccessful acquisition attempt in 1991 byHanson of the firm in what would have been the biggest takeover in British history. That same year, ICI sold its agricultural and merchandising operations of BritAg and Scottish Agricultural Industries toNorsk Hydro; it sold itsnylon business toDuPont one year later. In 1993, the firm also de-merged its pharmaceutical bio-science businesses asZeneca. During 1997, ICI's Australian subsidiary,ICI Australia, was sold in exchange for £1 billion. During 2008, ICI was acquired byAkzoNobel for £8 billion;[3] shortly thereafter, portions of ICI were sold off toHenkel while its remaining operations were integrated within AkzoNobel's existing organisation.[4]
ICI also owned theSunbeam motorcycle business, which had come with Nobel Industries, and continued to build motorcycles until 1937.[8]
During theSecond World War, ICI was a major participant in Britain's war economy; its subsidiaryICI Nobel was involved in the production of munitions.[9][10] The company was involved with the United Kingdom's nuclear weapons programme codenamedTube Alloys.[11][12]
During the 1950s, ICI developed a material asCrimplene, a thickpolyester yarn that was used to make a fabric of the same name.[15] The resulting cloth is heavy and wrinkle-resistant, and retains its shape well. The California-based fashion designerEdith Flagg was the first to import this fabric from Britain to the United States.[16] During the first two years, ICI gave Flagg a large advertising budget to popularise the fabric across America.[citation needed]
During 1960,Paul Chambers became the first chairman appointed from outside the company.[17]Chambers employed the consultancy firmMcKinsey to help with reorganising the company.[17] Export sales doubled during his eight-year tenure export, however, Chambers' reputation was severely damaged by a failed takeover bid forCourtaulds in 1961–1962.[17][18]
In 1964, ICI acquired British Nylon Spinners (BNS), the company it had jointly set up in 1940 with Courtaulds. ICI surrendered its 37.5 per cent holding in Courtaulds and paid Courtaulds £2 million a year for five years, "to take account of the future development expenditure of Courtaulds in the nylon field." In return, Courtaulds transferred to ICI their 50 per cent holding in BNS.[20] BNS was absorbed into ICI's existing polyester operation, ICI Fibres. The acquisition included BNS production plants inPontypool,Gloucester andDoncaster, together with research and development in Pontypool.[citation needed]
Peter Allen was appointed chairman between 1968 and 1971.[22] He presided over the purchase ofViyella.[22] Profits shrank under his tenure.[22] During his tenure, ICI created the wholly owned subsidiaryCleveland Potash Ltd, for the construction ofBoulby Mine in Redcar and Cleveland, North Yorkshire. The first shaft was dug in 1968, with full production from 1976. ICI jointly owned the mine with Anglo American, and then with De Beers, before complete ownership was transferred toIsrael Chemicals Ltd in 2002.[23]
Between 1971 and 1975, Jack Callard held the position of chairman at the firm.[24] Amid Callard's tenure, company profits almost doubled between 1972 and 1974 while ICI became Britain's largest exporter.[24] In 1971, the company acquired Atlas Chemical Industries Inc., a major American competitor.[5][25] In 1977,Imperial Metal Industries was divested as an independent quoted company.[26][27]
Between 1982 and 1987, the company was headed by the charismaticJohn Harvey-Jones.[28] In 1985, ICI acquired the Beatrice Chemical Division; during the following year, it also bought Glidden Coatings & Resins, a leadingpaints business.[29][30]
By the early 1990s, plans were carried out to demerge the company, as a result of increasing competition and internal complexity that caused heavy retrenchment and slowing innovation.[2] In 1991, ICI sold the agricultural and merchandising operations ofBritAg andScottish Agricultural Industries toNorsk Hydro.[31] It also divested itssoda ash products arm toBrunner Mond, ending an association with the trade that had existed since the company's inception, one that had been inherited from the original Brunner, Mond & Co. Ltd.[32]
During mid 1991, ICI was subject to an attempted acquisitionHanson; by this point, ICI was commonly being viewed by investors as having been in decline and thus its valuation was depressed, making it more vulnerable to such takeover attempt.[33][34] Hanson had acquired a 2.8 per cent stake in the company as part of itshostile takeover attempt, which ICI's management team chose to oppose.[35][36] The envisioned acquisition became hotly contested and controversial, partially as it would have been the biggest takeover in British history at that point.[37] In October 1991, Hanson opted to not proceed with the deal.[33][2]
In 1992, the company sold its nylon business toDuPont.[38][39] During 1993, the company de-merged its pharmaceutical bio-science businesses: pharmaceuticals,agrochemicals, specialities,seeds andbiological products were all transferred into a new and independent company calledZeneca.[2] Zeneca subsequently merged withAstra AB to formAstraZeneca.[40]
In 1994, Charles Miller Smith was appointed CEO of ICI, one of the few times that an external figure had been appointed to lead the firm, Miller-Smith having previously been a director atUnilever. Shortly afterwards, the company acquired a number of former Unilever businesses in an attempt to move away from its historical reliance oncommodity chemicals. During 1995, ICI acquired the American paint companiesDevoe Paints,[41]Fuller-O'Brien Paints[42] andGrow Group.[43] In 1997, ICI acquired National Starch & Chemical,Quest International, Unichema, and Crosfield, thespeciality chemicals businesses ofUnilever in exchange for $8 billion.[44][45] This step was part of a strategy to move away from cyclical bulk chemicals and to progress up the value chain to become a higher growth, higher margin business.[5] Later that same year, it went on to buyRutz & Huber, a Swiss paints business.[46]
Having taken on some £4 billion of debt to finance these acquisitions, the company was soon compelled to sell off its commodity chemicals businesses:
Disposals of bulk chemicals businesses at that time included the sale of its Australian subsidiary,ICI Australia, for £1 billion in 1997,[47] and of itspolyester chemicals business toDuPont for $3 billion also in 1997.[48][49]
In 2000, ICI sold its diisocyanate, advanced materials, and speciality chemicals businesses onTeesside and worldwide (including plants atRozenburg in the Netherlands, and South Africa,Malaysia andTaiwan), and Tioxide, itstitanium dioxide subsidiary, toHuntsman Corporation for £1.7 billion.[52][53] It also sold the last of its industrial chemicals businesses toIneos for £325 million.[54]
In 2002, the ICI wholly transferred ownership ofBoulby Mine to Israel Chemicals Ltd.[55]
In 2006, the Company sold Quest International, itsflavours and fragrances business, toGivaudan, for £1.2 billion[56] and Uniqema, its oleochemical business, toCroda International, for £410 million.[57]
Having sold much of its historically profitable commodities businesses, and many of the new speciality businesses which it had failed to integrate, the company consisted mainly of the Dulux paints business, which quickly found itself the subject of a takeover by AkzoNobel.
In June 2007, the Dutch firmAkzoNobel (owner of Crown Berger paints) bid £7.2 billion (€10.66 billion or $14.5 billion) for ICI. An area of concern about a potential deal was ICI's Britishpension fund, which had a deficit of almost £700 million and future liabilities of more than £9 billion at the time.[58] Regulatory issues in the UK and other markets whereDulux and Crown Paints brands each have significant market share were also a cause for concern for the boards of ICI and AkzoNobel. In the UK, any combined operation withoutdivestments would have seen AkzoNobel have a 54 per cent market share in the paint market.[59] The initial bid was rejected by the ICI board and the majority of shareholders.[60] However, a subsequent bid for £8 billion (€11.82 billion) was accepted by ICI in August 2007, pending approval byregulators.[61]
On 2 January 2008, completion of the takeover of ICI plc by AkzoNobel was announced.[3] Shareholders of ICI received either £6.70 in cash or AkzoNobel loan notes to the value of £6.70 per one nominal ICI share. The adhesives business of ICI was transferred toHenkel as a result of the deal,[62] while AkzoNobel agreed to sell its Crown Paints subsidiary to satisfy the concerns of theEuropean Commissioner for Competition.[63] The areas of concern regarding ICI's British pension scheme were addressed by ICI and AkzoNobel.[64]
ICI operated a number of chemical sites around the world.In the UK, the main plants were as follows:
Billingham Manufacturing Plant (inStockton-on-Tees) andWilton (in present-dayRedcar and Cleveland): ICI used the Billingham site to manufacturefertilisers in the 1920s and went on to produce plastics at Billingham in 1934. DuringWorld War II it manufacturedSynthonia, asyntheticammonia for explosives.[65] The Wilton R&D site was built to support the plastics division with R&D and chemical engineering facilities. The ICI Billingham Division was split into the ICI Heavy Organic Chemicals Division and ICI Agricultural Division in the 1960s. From 1971 to 1988 ICI Physics and Radioisotopes Section (later known as Tracerco) operated a smallGeneral AtomicsTRIGA Mark Inuclear reactor at its Billingham factory for the production of radioisotopes used in the manufacture of flow and level instruments, among other products.[66] The Agricultural Division was noted for the development of the world's largest bioreactor at the time – the 1.5 million litre Pruteen Reactor, used for the cultivation of animal feed. Engineering models of components and the builder's model of the complete plant are now in the collection of theScience MuseumLondonArchived 19 November 2021 at theWayback Machine. Pruteen had limited economic success but was followed by the much more successful development ofQuorn.
Blackley (inManchester) and Huddersfield: ICI used the sites to manufacturedyestuffs. The dye business, known as the ICI Dyestuffs Division in the 1960s, went through several reorganisations. Huddersfield was tied in with Wilton with the production of nitrobenzene and nitrotoluene. Huddersfield also produced insecticides. (Syngenta still manufacture insecticides at Huddersfield). ProxelBiocide was made at Huddersfield from the 80s onwards. Additives also made at Huddersield. Huddersfield became Zeneca then AstraZeneca, in 2004 Huddersfield was Syngenta, Avecia, Arch and Lubrizol running what were all ICI plants at one time. Through the years it was combined with otherspeciality chemicals businesses and became Organics Division. Then became ICI Colours and Fine Chemicals and then ICI Specialties.[67]
Buxton (inDerbyshire): ICI Lime Division was formed in 1927 with the acquisition ofBuxton Lime Firms. Quarrying started atTunstead in 1929 and it became the largest limestone quarry in the UK. In 1992 ICI sold its Lime Division toAnglo American as part of its UKTarmac operation.[68][69]
Runcorn (inCheshire): ICI operated a number of separate sites within the Runcorn area, including the Castner-Kellner site, where ICI manufacturedchlorine andsodium hydroxide (caustic soda).[70] Adjacent to the Castner-Kellner site was Rocksavage works, where a variety of chemicals based on chlorine products were manufactured, including Chloromethanes, Arklone dry cleaning fluid, Trichloethylene degreasing fluid and the Arcton range of CFCs. Also on that site were PVC manufacture and HF (Hydrogen fluoride) manufacture. At Runcorn Heath Research Laboratories, technical support, research and development for Mond Division products was carried out, and the support sections included chemical plan design and engineering sections. Just to the north of Runcorn, on an island between the Manchester Ship Canal and the River Mersey could be found the Wigg Works, which had been erected originally for producing poison gas in wartime. In Widnes could also be found several factories producing weedkillers and other products. For many years it was known as ICI Mond Division but later became part of the ICI Chemicals and Polymers Division. The Runcorn site was also responsible for the development of the HiGEE and Spinning Disc Reactor concepts. These were originated by Professor Colin Ramshaw and led to the concept ofProcess Intensification; research into these novel technologies is now being pursued by the Process Intensification Group atNewcastle University.[71]
Winnington and Wallerscote (inNorthwich, Cheshire): It was here that ICI manufacturedsodium carbonate (soda ash) and its various by-products such assodium bicarbonate (bicarbonate of soda), andsodium sesquicarbonate. The Winnington site, built in 1873 by the entrepreneursJohn Tomlinson Brunner andLudwig Mond, was also the base for the former company Brunner, Mond & Co. Ltd. and, after the merger which created ICI, the powerful and influential Alkali Division. It was at thelaboratories on this site thatpolythene was discovered by accident in 1933 during experiments into high pressure reactions.[72] Wallerscote was built in 1926, its construction delayed by the First World War, and became one of the largest factories devoted to a single product (soda ash) in the world.[73] However, the decreasing importance of the soda ash trade to ICI in favour of newer products such as paints and plastics, meant that in 1984 the Wallerscote site was closed, and thereafter mostly demolished. The laboratory where polythene was discovered was sold off and the building became home to a variety of businesses including a go-kart track and paintballing, and the Winnington Works were divested to the newly formed company,Brunner Mond, during 1991. It was again sold in 2006, to Tata (an Indian-based company) and in 2011 was rebranded as Tata Chemicals Europe. The Winnington plant closed in February 2014, with the last shift on 2 February bringing to a close 140 years of soda ash production in this Northwich site.[citation needed]
An ICI subsidiary called Duperial operated in Argentine from 1928 to 1995, when it was renamed ICI.
Established in the city ofSan Lorenzo, Santa Fe,it operates an integrated production site with commercial offices inBuenos Aires. Since 2009 it has madesulphuric acid with ISO certification under the company name Akzo Nobel Functional Chemicals S.A.[citation needed]
It also had an operation atPalmira, Mendoza, for its Wine Chemicals Division, that manufacturedtartaric acid, wine alcohol andgrapeseed oil from natural raw material coming from the wine industry in the provinces of Mendoza and San Juan. This operation held 10% world market share for tartaric acid. It was sold in 2008 and currently operates as Derivados Vínicos S.A. (DERVINSA).[77]
In 1968 a subsidiary of Imperial Chemical Industries (ICI) was established in then-East Pakistan.AfterBangladesh gained independence in 1971, the company was incorporated on 24 January 1973[81] as ICI Bangladesh Manufacturers Limited and also as Public Limited Company. The company divested its investment in Bangladesh and was renamed asAdvanced Chemical Industries Limited (ACI Limited) on 5 May 1992. The company sold its insect control, air care and toilet care brands toSC Johnson & Son in 2015.[82] Currently Advanced Chemical Industries (ACI) Limited is one of the largest conglomerates in Bangladesh with a multinational heritage operating across the country.[83] The company operates through three reporting divisions: Pharmaceuticals, Consumer Brands and Agribusiness.[84]
ICI maintained offices in Colombo importing and supplying chemicals for manufacturers in Ceylon. In 1964, following import restrictions that allowed only locally owned subsidiaries of multinational companies to gain import licenses,Chemical Industries (Colombo) Limited was formed as an ICI subsidiary with 49% ICI ownership and remaining held public.[85]
The subsidiary ICI New Zealand provided substantial quantities of chemical products – including swimming pool chemicals, commercial healthcare products, herbicides and pesticides for use withinNew Zealand and the neighbouringPacific Islands.
Afire at the ICI New Zealand store inMount Wellington,Auckland, on 21 December 1984, killed an ICI employee and caused major health concerns. Over 200 firefighters were exposed to toxic smoke and effluents during the firefighting efforts. Six firefighters retired for medical reasons as a result of the fire. This incident was a major event in the history of theNew Zealand Fire Service and subject to a formal investigation, led by futureChief JusticeSian Elias. The fire was a trigger for major reforms of the service; direct consequences included improved protective clothing for firefighters, a standard safety protocol for major incidents, the introduction of dedicated fireground safety officers, and changes to occupational health regulations.[86][87]
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^abcdOwen, Geoffrey; Harrison, Trevor (1 March 1995)."Why ICI Chose to Demerge".Harvard Business Review.Archived from the original on 7 November 2016. Retrieved6 November 2016.
^Keesing's Record of World Events (formerly Keesing's Contemporary Archives). Vol. 10. United Kingdom. July 1964. p. 20162.{{cite book}}: CS1 maint: location missing publisher (link)
^GB withdrawn 2085000, Crosby, John, "An improved process for the preparation of certain cyclopropane pyrethroid intermediates having a high cis-content", published 21 April 1982, assigned to ICI plc
^Elias, Sian; Bandaranayake, D R; Edwards, I R; Glass, W I (1 January 1990)."The Health Consequences of the ICI Fire"(PDF).New Zealand Ministry of Health.Archived(PDF) from the original on 21 October 2018. Retrieved20 October 2018.
Dick, W.F.L. (1973).A Hundred Years of Alkali in Cheshire. Birmingham, UK.{{cite book}}: CS1 maint: location missing publisher (link)
Owen, Geoffrey (2000).From Empire to Europe: The Decline and Revival of British Industry Since the Second World War. HarperCollins.ISBN978-0-00-638750-3.
Reader, W. J. (1970).Imperial Chemical Industries: A History, vol. I: The Forerunners, 1870–1926. Oxford, UK: Oxford University Press.ISBN9780192159373.
Reader, W. J. (1975).Imperial Chemical Industries: A History, vol. 2: The First Quarter-Century, 1926-1952. Oxford, UK: Oxford University Press.ISBN9780192159441.
Leslie, Esther (2023).The Rise and Fall of Imperial Chemical Industries: Synthetics, Sensism and the Environment. London, UK: Palgrave.ISBN978-3031374319.
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