The combination of the TiO2 businesses of Tronox and Cristal creates one of the world’s largest and most highly integrated TiO2 pigment producers with assets and operations on six continents.
The combined company will operate 11 TiO2 pigment plants in eight countries.. Total capacity will be 1.3 million metric tons per year. It will have titanium feedstock operations in three countries with a total capacity of 1.5 million metric tons per annum.
“We are pleased to announce the highly synergistic combination of the TiO2 businesses of Tronox and Cristal that will bring significant value to our shareholders, our customers and our employees,” said Tom Casey, Tronox chairman and CEO. “Because we don’t expect to take on new debt, we project a 50% reduction in our net leverage ratio.
“Our intent to sell Alkali comes at an attractive time as the global market for natural soda ash is recovering and prices are improving. Alkali has continually sold every ton of product it produces. The caliber of the Alkali workforce and their commitment to safe, high-quality production are unmatched in the natural soda ash industry. I thank the leadership team and all Alkali employees for their contributions to Tronox,” added Casey.
“This transaction enables Cristal and Tronox to position the combined businesses for long-term success in the TiO2 industry,” Tasnee CEO Mutlaq Al-Morished said. “This also allows Tasnee to focus on its petrochemical assets, downstream business and other strategic business development opportunities, while substantially deleveraging its balance sheet.”
The acquisition has received the unanimous approval of the Tronox and Cristal boards of directors. The transaction is subject to the approval by Tronox Class A and B shareholders, voting as a single class, as well as regulatory approvals and customary closing conditions. Closing is expected to occur before the first quarter 2018, and Tronox anticipates completing the sale of its Alkali business in the second half of 2017.
Casey will remain chairman and CEO of the company. The size of the company’s board of directors will remain unchanged at nine members. Cristal’s owners will receive two of the nine existing Board seats. The company’s corporate offices will remain in Stamford, CT.