ICI shares continue to slip amid rights issue uncertainties

01 February 2002 11:11  [Source: ICIS news]

LONDON (CNI)--Shares in ICI continued to slide on Friday amid uncertainties surrounding the UK specialty chemicals producer's planned £800m ($1.13bn/Euro1.30bn) rights issue.

The shares fell by nearly 9% on the London Stock Exchange (LSE) in early trading but at approximately 10:50 hours GMT they were down 6.6% at £3.08.

This follows a 10.9% fall in ICI's share price yesterday, when the company revealed it was in the advanced stages of preparation for a rights issue to raise approximately £800m, net of expenses. It also forecast an 11% decline in group pre-tax profits to £401m for 2001 and said it would divest its Synetix catalyst business.

ICI said proceeds from the rights issue, which is expected to be underwritten, plus the Synetix divestment will be used to pay down debt. It explained that it was planning the rights issue due to concerns about a possible credit ratings downgrade.

Following the announcement, credit ratings agencies Moody's and Standard & Poor's (S&P) assigned stable outlooks for ICI and confirmed their respective Baa2 and BBB ratings.

Further details of ICI's rights issue will be released on Monday, when the group publishes its 2001 financial results in full.

By: Anna Jagger
+1 713 525 2653

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