ICI India is all set for a demerger after its parent company ICI on August 13 accepted a takeover offer from Dutch conglomerate Azko Nobel for £8.1 billion (about $16 billion). ICI India''s paints and speciality chemicals businesses will be divided as Azko Nobel has an agreement with Henkel to sell ICI''s adhesives and electronic material businesses for £2.7 billion. ICI India''s paints business, with revenues of Rs 900 crore, will go to Azko Nobel, while its adhesives and electronic material division, with revenues of Rs 100 crore, will go to Henkel. This transaction is likely to be completed by the end of the year.
ICI and Asian Paints compete in India and Sri Lanka with Asian Paints leading in Indian market and ICI leading in Sri Lanka. The Rs 11,500 crore Indian paints industry is dominated by unorganised players with 35% market share. In the organised segment, Asian Paints is the leader with 26% market share, followed by Nerolac Paints and Berger Paints and ICI India with 12% market share each.
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