Shareholders willing, Britain's Imperial Chemical Industries plc(ICI) will "demerge" this spring into two separate companies.
The split would sever ICI's burgeoning bioscience activitiesfrom the more traditional paints, explosives and commoditychemicals for which the company was founded in 1926.
In making the announcement on Thursday, Denys Henderson,company chairman, said, "The board of directors hasunanimously recommended that ICI should now proceed to putto its shareholders formal proposals for the demerger of Zeneca(the name of the future biosciences successor concern)."
Zeneca began as a wholly owned subsidiary on Jan. 1 to takeover R&D, manufacturing and marketing of ICI'spharmaceutical, agrochemical and specialty products. Of these,the first two have a hefty biotechnology component.
"Zeneca is a word coined in Britain," ICI's North Americanmedia relations manager, Bill Warelis, told BioWorld. "Itcombines the concepts of "zenith," alchemy and chemistry." Headded that "demerge" is also an Anglicism, denoting theopposite of "merge."
Henderson, who remains chairman of both companies, alsoannounced that Zeneca's first independent act would be tolaunch an initial public offering, to raise some 1.3 billion(approximately $2 billion) "to reduce its indebtedness to ICI."
He explained, "Our decision to proceed with the demerger wasdirectly attributable to meeting the changes taking place in thechemical industry, exacerbated by the recession."
Among the non-executive directors named to serve on thetruncated ICI's future board is economist Paul A. Volcker,chairman from 1979 to 1987 of the U.S. Federal Reserve Bank.
Peter Doyle, ICI's research and technology director, will be oneof Zeneca's executive directors. Doyle was chairman of theseven-member advisory group on biotechnology, a high-levellobby at the European Economic Commission.
In the U.S., Zeneca is absorbing businesses previously part ofICI, Americas Inc. It will become a $2.6 billion enterprise, with8,000 employees and 52 R&D and manufacturing sites in theU.S.
Zeneca inherits from its parent company a tradition ofbiotechnology ventures going back to the beginnings of theindustry:
-- In 1980, ICI was one of the few R&D companies to clonealpha-interferon.
-- In December 1979, it edged out General Electric to becomethe first to claim a biotechnology patent in Japan. (GE's entrywas the Chakrabarty oil-eating patent.)
ICI's patent-seeking invention was a method of producingmicrobial single-cell protein. Based on experience fermentingantibiotics from microorganisms, ICI scientists constructed abacterium, Methylophilus methylotrophus, which convertsmethanol, ammonia and air into a nutritious, edible "Pruteen,"intended for human consumption.
A decade ago, the company assembled a massive fermenter atits site in Billingham, England. It was rated the largestcontinuous monoculture fermentation unit in the world.
Pruteen, however, was derailed as a new food and fodder, byadverse economic costs and market factors.
In the early 1980s, ICI invested $200 million in a plant,Marlborough Biopolymers, to make bacterial "BioPol," adegradable plastic, from polyhydroxybutyrate and alkanoate. Ithas been commercialized for producing surgical sutures.
And on Feb. 4, the European patent office of the WorldIntellectual Property Organization published the full text of anICI patent application, WO 93/02194, which claims genes forpolyhydroxyalkanoate synthase, expressed by Chromatiumvinosum.
Other ICI (now Zeneca) agricultural biotechnology patentapplications disclosed in recent months cover herbicide-resistant plants, anti-glyphosate bacteria, control of geneexpression in plants and modified ripening in tomatoes.
In the pharmaceutical field, disclosures concern diagnosis andtherapy of Alzheimer's disease, plasmin-inhibiting antibodiesand ricin toxin chains for monoclonal-conjugation, andmultifunction expression vectors.
-- David N. Leff Science Editor
(c) 1997 American Health Consultants. All rights reserved.