ICI widens interests in S Africa

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The Independent Online
ICI, the chemicals giant, is boosting its interests in South Africa by taking majority control of a local explosives business, writes Neil Thapar.

The company is acquiring a 51 per cent stake in AECI Explosives, which is being hived off from a quoted company, AECI. In return ICI will reduce its stake in AECI from 38 to 13 per cent.

Anglo American, South Africa's biggest company, owns almost 40 per cent of AECI, with the balance held by private investors.

Although the asset swap does not involve cash, ICI said it would strengthen its direct involvement in the country. 'South Africa is a major market for explosives. We welcome the direct link with AECI Explosives and look forward to the new joint venture participating in our worldwide business,' Bob Clark, chief executive of ICI Explosives, said.

AECI Explosives, in which Anglo will own the balance, has an estimated annual turnover of pounds 150m and is an important profits contributor to ICI's explosives division.

The move comes a week after Nelson Mandela, president of the African National Congress, urged British companies to lift their investment in South Africa. ICI said the deals were primarily 'business-driven'.