ICI owner in red after write-down

A €1.1bn write-down on Dulux paints giant ICI sent its new Dutch owner crashing into the red today.

Chemicals firm Akzo Nobel, which bought ICI for €9bn in 2008, booked the €1.2bn loss to reflect lower than expected growth rates as global markets falter.

The decision to mark down ICI’s decorative paints and national starch operations left Akzo with a net loss of €1.09bn for 2008.

Chief financial officer Keith Nichols said: “Our regular periodic assessment of the fair value of our assets has been undertaken against the background of markedly changed market conditions.”

Akzo shed more than 1,600 staff across the business during 2008 as well as freezing salaries for more than 500 executives.

Decorative paints revenues shrank 6% during a difficult final quarter of last year, while its performance coatings arm also saw a 4% decline.

The falls outweighed a modest 3% increase at its speciality chemicals operation - which makes ingredients in products ranging from ice cream to asphalt – to leave overall revenues 3% down over the three month period.

Chief executive Hans Wijers said: “We are acutely aware that global market conditions and lack of visibility do not allow for any certainty.

“The harsh trading conditions experienced towards the end of the fourth quarter have continued into 2009 and, as a result, we expect this year to be very challenging.”

ICI delisted from the London market in February 2009 following the completion of Akzo’s takeover, ending 82 years of independence for ICI.

Akzo also owned Crown Paints but was compelled to sell the business on competition grounds after the ICI deal.

It sold the firm to management last year in an estimated £70 million deal - backed by UK investment fund Endless.