US Tronox completes acquisition of Cristal; FTC approves N American TiO2 divestiture to INEOS
April 11, 2019
Tronox has completed the acquisition of Saudi Arabia’s National Titanium Dioxide Co (Cristal), following US approval of a remedy that addressed antitrust concerns, the US-based titanium dioxide (TiO2) producer announced on Wednesday.
The Federal Trade Commission (FTC) voted 5-0 to accept a proposal involving the divestiture of Cristal’s North American TiO2 business to UK-based INEOS.
“This agreement will preserve a competitive marketplace, which ultimately benefits consumers in the form of lower prices and higher quality products,” Bureau of Competition director Bruce Hoffman said.
The divestiture is expected to close on 1 May, Tronox said.
Tronox’s divestiture of its 8120 paper laminate grade business to US-based Venator is expected to close imminently, Tronox added.
In February 2017, Tronox announced its $2.4bn bid to buy Cristal.
The FTC challenged the proposed acquisition in December 2017, alleging that Tronox’s acquisition of Cristal for $1.67bn and a 24% stake in the combined entity would significantly reduce competition in North America.
In July 2018, the FTC obtained a preliminary injunction, which prevented Tronox from completing the acquisition.
Under the consent order approved on Wednesday, Tronox and Cristal must:
– Divest to INEOS two chloride process TiO2 plants and related assets in Ashtabula, Ohio, and transfer or license all intellectual property rights for production there;
– Divest to INEOS research and development (R&D) equipment and administrative support functions at the Baltimore Administrative and Technical Center (BATC);
– Provide INEOS the ability to hire Cristal personnel in North America, including those at the Ashtabula plants at the BATC;
– Provide INEOS the option to acquire rights to use the licensed intellectual property at plants outside North America; and Transfer or assign to INEOS customer contracts related to Cristal’s sales in North America.
“I am pleased this transformative acquisition has finally been completed and I greatly admire the resiliency both organisations have shown throughout this process,” Tronox chairman and CEO Jeffry Quinn said. “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.”
By Tracy Dang
Source: ICIS News