ICI plans buying spree next year

ICI is planning a string of acquisitions in the pharmaceuticals and biotechnology industries when it splits into two companies early next year.

One possibility it is thought to have considered is a takeover bid for Fisons, Britain's fourth largest drugs company. Fisons has been hit hard by quality problems in the US, leaving it vulnerable.

Many experts believe Fisons' product range would complement ICI's pharmaceuticals portfolio. In particular, they point to Fisons' expertise in marketing anti-asthma drugs, of which ICI has a number undergoing clinical trials.

ICI announced last week that it would split into two separately quoted companies - ICI Bio, comprising the group's pharmaceutical and agro-chemical interests, and ICI plc, consisting of the commodity chemicals rump of explosives, petrochemicals and paints.

Contacted in the US, where he has been explaining ICI's demerger plan to employees and investors, David Barnes, who will become chief executive of ICI Bio, said: 'In the past we have looked at the possibility of making acquisitions. But ICI has had chemical paper and to acquire pharmaceutical companies at their ratings has been impossible - we just couldn't make the numbers work. With pharmaceutically rated paper it would be much more feasible.'

Sir Denys Henderson, chairman of ICI, said: 'We have grown our pharmaceuticals company organically from scratch, but we now believe it is right to split it out, together with other speciality chemicals, from the rest. If it wants to do deals in future, it will be able to without having the problem of the other part of ICI to deal with.

'Pharmaceuticals is a highly fragmented industry. We believe there will be considerable restructuring over the rest of the decade. If a sensible opportunity to make ICI Bio bigger at a sensible price arose, we would do it,' Sir Denys added.