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ICI Acquires Advanced Applied Adhesives to Strengthen Its Leading Position in Electronic Materials

August 16, 2007

Imperial Chemical Industries PLC (ICI) has today acquired US-based technology business Advanced Applied Adhesives (AAA), to enable commercial exploitation of AAA’s technologies in the semi-conductor and electronic component assembly markets through ICI’s Electronic Materials (EM) business.

EM is a market leader in the high-growth global semiconductor packaging and circuit assembly segments of the electronic materials sector.

Products include highly specialised formulations of adhesives, encapsulants and coatings used to connect and protect integrated circuits and other components used in electronic devices, from PCs, to mobile phones, cameras, MP3 players, digital printers and more.

Based in San Diego, California, AAA – in conjunction with its sister company Designer Molecules Inc (DMI) - has developed a wide range of novel patented technologies for applications in markets served by EM. It has other high-potential technologies for these markets under development.

ICI’s EM operations have the resources and global customer base to leverage these technologies to achieve their significant commercial potential quickly.

AAA will be integrated into the Ablestik unit of EM, but will develop technologies for all of the EM businesses. Potential applications of the new technologies include mobile phones, laptop computers and other handheld and portable devices.

DMI will work with EM after it acquires AAA to continue developing a range of technologies used in formulated electronic materials.

Payments have been structured to provide incentives for AAA management and R&D staff transferring to EM to achieve development and growth targets.

The consideration paid represents less than one per cent of ICI Group net assets.

No regulatory approvals are needed to complete this transaction.

Commenting on the acquisition, Alan Syzdek, Group Vice President Electronic Materials, said: “We have been following the development of AAA for the past five years, and we are excited at the opportunities and growth potential that will open up for us by combining AAA’s innovative technologies, intellectual property and know-how with Electronic Materials’ extensive market reach. While the principal benefits of the deal will not come through for two to three years, we will be working to leverage the capabilities of the new team across our operations to deliver the maximum long-term benefit of this acquisition.”