Britain's Imperial Chemical Industries Plc has rejected a 7.2 billion-pound ($14.2 billion) bid approach from Dutch chemicals group Akzo Nobel NV, saying it undervalued the company. Shares in ICI, which makes Dulux paints, jumped as much as 17.3 percent to an eight-year high of 644 pence on Monday, after news it had rejected the 600 pence-a-share cash proposal.
Akzo, the world's largest maker of industrial coatings, fell 2 percent to 60.36 euros. Rabo Securities said a bid of 600 pence a share or above would be value-destroying for its shareholders.
ICI, Britain's biggest chemicals company, has long been tipped as a bid target after slimming to focus on high-margin paints and adhesives, and speculation Akzo would make a bid rose after the Dutch group sold its drugs unit in March for 11 billion euros ($14.7 billion).
Buying ICI, which makes 27 percent of its sales in Asia, would give Akzo a bigger share of fast-growing emerging markets and help it fix its underperforming European decorative business, with minimal antitrust issues, analysts said.
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