Gurgaon, 8 November 2005

The Board of Directors at its meeting held on 8 November 2005 has recommended transfer of the Company's Rubber Chemicals Business, subject to necessary approvals, to a joint venture compnay ("JVC") to protect the long-term interest of the business.

Rubber Chemicals Business was established in 1964 at Rishra site in West Bengal and its production capacity was increased progressively. The business had a sale of Rs 106 cr including export of Rs 22 cr in the financial year 2004-05.

The business has been subjected to intense international pricing pressures and competition in the recent past and to protect its long-term interest, it has become necessary to seek support from a business group having experience in allied operations with international presence. After evaluating various options, the Company has secured a non-binding offer from the PMC Group International, USA. Established in 1994, PMC Group is a diversified global producer of innovative performance chemicals and plastic products with a strong presence in the US and Europe. The Rubber Chemicals business, a regional business of ICI, is expected to gain from its association with PMC's technical and maketing expertise.

The proposed transaction will involve transfer of the Rubber Chemicals business with all associated assets to a JVC in which the PMC Group International and ICI India will hold 51% and 49% interest respectively. About 200 employees, currently working with the business, will transfer to the JVC with continuity of service on terms no less favourable than the current terms.

ICI India will receive about Rs 8 cr for transfer of 51% interest in the business to the JVC. The shareholders agreement envisages a pull out option for ICI India with corresponding call option for PMC Group International and the value will depend upon the performance of the JVC.

The Board believes that the transaction as set out above is in the best interests of the business including its customers and employees as well as all the stakeholders and the Company.

The transaction is expected to be implemented in the next few months after receiving all the necessary approvals including the approval of ICI India shareholders through the Postal Ballot.