£1.27b Cristal deal finally cracked by Tronox
By Grimsby Telegraph | Posted: 11 Apr 2019
A sprawling titanium dioxide plant on the South Humber Bank has changed hands for a fifth time, after a long drawn out takeover finally completed.
US giant Tronox's buy-out of Cristal, the Saudi Arabian state-owned entity, was confirmed to the New York Stock Exchange before today’s trading.
It follows a lengthy hold-up as US legislators blocked the deal on anti-competition grounds, forcing a separate sell-off of Cristal’s US operations to Ineos.
The deal will now close on May 1.
The site at Stallingborough.
Jeffry N Quinn, chairman and chief executive of the new owner, said: “I am pleased this transformative acquisition has finally been completed and I greatly admire the resiliency both organisations have shown throughout this process.
“I also appreciate the professionalism and collaborative mindset applied by the FTC Bureau of Competition and the staff of the FTC in working with Tronox, Cristal and Ineos to reach this resolution.
“We look forward to getting to the business of creating value for our shareholders, serving the needs of our global customers and creating opportunities for our employees.”
The £1.27 billion deal was agreed 777 days ago, back in February 2017, and with both companies having operations in several global locations, consents were required in several geographical regions.
Jeffry N Quinn and titanium dioxide in its powder form.
A sale of one site in Holland was required to satisfy the European Commission, and that too is now close to completion. The dual US site sale to Ineos, the chemical giant founded by Sir Jim Ratcliffe, a former Beverley Grammar School pupil regarded as Britain’s richest man, will now proceed also.
A team has been on site in Stallingborough for the "game-changing transformation," as described by Mr Quinn, who toasted "day one of a new Tronox".
"We have great assets and a strong market position in every corner of the world, and it is our extraordinary people who differentiate us," he said, praising talent and knowledge.
Mr Quinn added: "We intend to not miss a beat in meeting production goals, serving customers, delivering synergies and tracking and reporting our results."
The companies were previously vying for leading positions in the market, making the whitening agent used in products found in the home, in paint and other construction materials. The process is highly complex, and one of the most technically challenging due to the chemicals and processes involved.
In a further statement, the company added: “Tronox is now one of the world’s leading producers of high-quality titanium products and zircon with the most diverse global footprint. We believe this combination is not just bright, it’s brilliant – for our employees, customers and shareholders.”
The corporate message accompanying the statement to the New York Stock Exchange.
There are 400 directly employed staff and contractors working at Stallingborough. It has an annual production capacity of 165,000 tonnes of titanium dioxide, and is the largest of its type in Europe, and the third largest of the nine plants now owned by Tronox. Only Hamilton, US, at 225,000 tonnes and Yanbu, Saudi Arabia, 200,000 tonnes, eclipse it, with directors underlining the importance of a global spread to reduce delivery time on a conference call.
A total of 29 per cent of the new entity’s custom is in Europe, with Botlek in Holland offering a capacity of 90,000 tonnes and Thann in France providing 32,000 tonnes. It is aiming for 92 per cent to 94 per cent utilisation of the entire 650,000 tonne capacity.
Stallingborough started as Laporte back in the summer of 1953, as post-war industrialisation kicked on with the Humber bank’s flat nature, immediate access to water, ports and rail, all proving attractive. It became SCM in 1984, then had brief tenures as Lyondell then Millennium, before the Saudi swoop in 2007.