Tronox meets European Commission conditions on proposed Cristal takeover

By Grimsby Telegraph | Posted: 20 Jul 2018

Tronox has submitted details to the European Commission outlining the proposed sale of a Dutch manufacturing operation as it seeks to meet conditions put in place ahead of the Cristal buy-out receiving its blessing. 

Fellow American company Venator has been lined up for the 8120 paper-laminate product grade titanium dioxide facility, currently supplied to European customers from Botlek.

It removes the penultimate hurdle in the long-running attempt to buy the titanium dioxide giant, with a huge plant in Stallingborough.

Tronox now has to satisfy a US district court of the merits of the buy-out. The Federal Trade Commission has laid papers in Columbia’s US District Court, alleging the £1.27 billion deal would violate antitrust laws by significantly reducing competition in the North American market for chloride-process TiO2.

However, it has also entered a binding Memorandum of Understanding with the fellow NYSE-listed company to sell Cristal’s two-plant TiO2 production complex in Ashtabula, Ohio, should it be required to satisfy American authorities. c

If the US District Court issues a preliminary injunction to prevent the Cristal acquisition, Tronox has the right to require Venator to purchase Ashtabula for $1.1 billion, dropping to $900 million should Tronox choose to fight it. 

A $75 million break fee has also been agreed if Tronox is able to complete the Cristal transaction without divesting Ashtabula to Venator and the paper-laminate grade divestiture is completed to obtain final European Commission approval. 

Jeffry N Quinn, president and chief executive officer of Tronox, said: “The Memorandum of Understanding with Venator enables Tronox to vigorously defend the merits of the Cristal transaction in US District Court, while ensuring we are prepared to move swiftly with a remedy transaction at a reasonable valuation if the Ashtabula divestiture is required. 

“We believe the Venator MoU, together with the filing of the 8120 divestiture agreements with the European Commission, demonstrates our commitment to completing the Cristal transaction and preserving shareholder value.

“Tronox welcomes the opportunity to demonstrate in District Court, how the pro-competitive, output-enhancing combination will benefit customers throughout North America and around the world.”

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