ICL Group is a leading specialty minerals and chemicals company with a long and rich history spanning several decades. The company has its origins in Israel’s national potash company, which was founded in the 1930s. Over the years, ICL Group has grown through mergers, acquisitions and expansion into new markets to become a global leader in its field.
The Early Years
The beginnings of ICL can be traced back to 1930 when Palestine Potash Limited was established by the British Mandate government in Palestine to produce potash from the Dead Sea. At the time, potash was a crucial agricultural fertilizer and there was high global demand. In 1932, Palestine Potash began operations at Sdom on the shores of the Dead Sea, using solar evaporation to extract potash. This marked the start of the modern potash industry in Israel.
After Israel’s independence in 1948, the company was nationalized by the Israeli government and renamed the Israel National Potash Company. It continued extracting potash from the Dead Sea to support Israel’s fledgling agricultural sector. By the 1960s, the company was exporting potash worldwide from its flagship Sdom plant.
Major Expansion and Consolidation
In 1968, Israel National Potash Company discovered large deposits of bromine and magnesium in the Dead Sea. This discovery catalyzed the company’s first major expansion into bromine and magnesium production to leverage its access to Dead Sea minerals. The company constructed large chemical production facilities along the Dead Sea.
The 1970s saw further expansion, including a joint venture with Shell Oil Company called Dead Sea Periclase to produce magnesium. By the end of the decade, the company had become one of the world’s leading producers of elemental bromine.
In 1975, the company was renamed Dead Sea Works to reflect its broadened scope beyond just potash production. Then in 1977, the company merged with the Negev Phosphates chemical company to form Israel Chemicals Ltd (ICL). This positioned ICL as a diversified chemicals producer.
Global Expansion Through Acquisitions
Under the leadership of Akiva Mozes, ICL began a strategy of global expansion through international acquisitions. The company’s first major international purchase was of the potash mining company Hispano-Kali in Spain in 1991. This gave ICL its first significant potash production capacity outside of Israel.
In the 1990s and 2000s, ICL continued pursuing this global growth strategy by acquiring leading specialty chemical companies and potash deposits around the world. Some key acquisitions included:
- 1995 – Acquired German specialty phosphates company Huri.
- 1998 – Acquired 50% stake in Britam, a UK flame retardants company.
- 1999 – Acquired Cleveland Potash in the UK, including extensive underground potash mines.
- 2004 – Acquired German specialty fertilizer company SKW Piesteritz.
- 2010 – Acquired Scotts Global Professional business, making ICL a leader in specialty fertilizers.
- 2012 – Acquired the remaining 50% stake in Britam, taking full ownership.
By the early 2000s, around 75% of ICL’s revenues were from exports and international operations. The company had secured a diverse production base spanning Israel, Europe, UK, China and the Americas.
Privatization and Focus on Specialties
In the 1990s, the Israeli government began a privatization drive of state-owned companies. As part of this initiative, the government sold its majority stake in ICL in 1995. The company became fully privatized by 1999, although the government retained a special “golden share” granting it some control powers.
As a private company focused on creating shareholder value, ICL began streamlining its operations and divesting non-core commodity businesses. In the 2000s, ICL sold its commodity phosphates and fertilizers businesses to focus exclusively on specialty minerals and chemicals.
ICL also expanded its geographical footprint in emerging markets such as China and Brazil where the demand for specialty chemicals was rising rapidly. This enabled ICL to position itself close to high-growth markets.
Recent Developments
In 2014, ICL fully divested from its last commodity business – potash – by merging its potash production with Germany’s PotashCorp in a joint venture called Israel Chemicals Potash Ltd (IC Potash). This joint venture focused solely on commodity potash, while ICL concentrated on specialty minerals and chemicals.
Today, ICL has become one of the world’s top specialty minerals and chemicals companies. It is dual-listed on the New York Stock Exchange and Tel Aviv Stock Exchange. ICL has manufacturing operations across over 30 sites globally and sells products in over 100 countries. Its business is structured across 3 divisions:
- Industrial Products manufactures bromine, phosphorus and magnesia products.
- Potash and Phosphate Solutions produces specialty fertilizers and phosphates.
- Innovative Ag Solutions provides specialty agriculture chemicals and solutions.
Some key financial highlights:
| Year | Revenue (USD billions) | Net Income (USD millions) |
|---|---|---|
| 2018 | 5.56 | 630 |
| 2019 | 5.27 | 560 |
| 2020 | 5.05 | 387 |
In 2020, ICL achieved revenues of $5.05 billion and net income of $387 million. Over the past decade, ICL has invested over $2.5 billion in production capacity expansions and improvements to drive future growth.
ICL continues to pursue its strategy of focus on high-margin specialty chemicals and minerals. It is targeting growth in emerging markets and from global sustainability megatrends in food production, water treatment, and electric vehicles. ICL is well-positioned to take advantage of these trends due to its portfolio of specialty products and solutions.
Conclusion
ICL Group has transformed itself over its 90+ year history from a small potash producer in the deserts of Palestine to one of the world’s foremost specialty chemicals companies. It has achieved this through continued innovation, focus on the highest value-add segments, and global expansion. If the last nine decades are any indicator, ICL is poised for a very bright future in supporting key industries and global sustainability needs through its specialty minerals and chemicals expertise.