Tronox boss updates the market on protracted Cristal buy-out
By Grimsby Telegraph | Posted: 6 Nov 2018
AN update on the protracted buy-out of Cristal by Tronox has been given by the latter’s president and chief executive, Jeffry Quinn, as the US firm’s third quarter results were published.
The New York Stock Exchange listed giant is looking to acquire the business from Saudi Arabian parent company Tasnee in a £1.27 billion deal that would create the world’s largest titanium dioxide producer.
A whitening agent, known as TiO2, it is used in products from building sites to bathrooms, and 400 people work at the sprawling site at Stallingborough, which recently celebrated 65 years of operations. With a capacity for production of 165,000 metric tonnes a year, it is the largest chloride-process titanium dioxide producer in Europe.
The agreement for it and 10 other global sites was announced in February last year, but objections in the US under anti-competition concerns have so far seen the deal unable to complete.
The Connecticut-headquartered business is now looking to sell off an asset to appease the authorities and get the huge transaction over the line, having already agreed a conditional deal in the Netherlands to gain European Commission approval. Consent has been given in every other territory either business operates in,
Mr Quinn, who reported sales of $456 million (£349 million) for the third quarter of 2018 up 5 per cent year-on-year, said: “We continue to progress toward closing the Cristal TiO2 acquisition.
“During the quarter, we received final approval from the European Commission to close the Cristal acquisition conditioned upon divesting our 8120 paper-laminate product grade to Venator Materials Plc. Consummation of this divestiture will occur following approval of the Cristal acquisition by US regulatory authorities. We continue discussions with the Federal Trade Commission regarding the potential divestiture of Cristal’s Ashtabula, Ohio, TiO2 complex as a settlement and potential remedy to enable completion of the Cristal acquisition.”
October 1 saw a 75-day exclusivity period expire with Venator to negotiate that deal on home soil, but the company said talks continue.
Tronox would be a sixth owner for the South Humber Bank site, and the deal is heavily weighted with a $60 million (£45.9 million) termination fee should it not be realised. A deadline date of March 31 is now looming, having been significantly widened from an original date of May this year.