ICI receives Rs7 billion investment offer

Expression of interest comes from international financial institution

KARACHI: ICI Pakistan - which manufactures different products including man-made fibre and soda ash for soap, detergents and fertiliser - has received an expression of interest from an international financial institution for investment of Rs7 billion.

"The transaction is subject to completion of satisfactory due diligence, agreement of definitive contracts and receipt of all relevant regulatory, board and shareholder, and other internal approvals by the investor and the company," the company stated in a notification sent to the Pakistan Stock Exchange (PSX) this week.

The company did not disclose the name of the interested international financial institution.

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It, however, explained that the investment would be in the form of "a convertible debt instrument", which means the investor may attract interest payments and convert the investment into the company's (ICI) shares at a pre-determined share price, it was learnt.

ICI Pakistan Chief Executive Officer Asif Jooma said in a statement that the company had received expression of interest for investment "in a challenging economic environment. This investment has come at an opportune time as this year we will be celebrating the milestone of completing 75 years of successful operations in Pakistan."

The company said it had progressed on several strategic projects during the year ended June 30, 2019, including expansion of the soda ash plant in phase-I. Expansion under phase-II is under way.

In May, the company launched commercial operations of Masterbatches manufacturing facility. Besides, the company has also initiated construction of a facility to manufacture infant formula in joint venture with NutriCo Morinaga (Private) Limited.

"Commercial operations at this facility are expected to commence during the second half of calendar year 2019," it said.

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Company earns Rs2.53b

The company recorded a consolidated profit of Rs2.53 billion in the year ended June 30, 2019, which was 23% lower than the previous year.

The drop in profit came "mainly due to interest rate-driven higher finance costs and higher taxation expenses," the company said in the statement.

The board approved a final cash dividend of Rs4.5 per share. This is in addition to the interim cash dividend of Rs4.5 per share already paid to the shareholders.

The company's net revenue increased 19% to Rs59.38 billion compared to the previous year with the growth being led by soda ash (32%), polyester (30%) and chemicals and agriculture sciences (4%).

Published in The Express Tribune, July 27^th, 2019.

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