Tronox to acquire Cristal TiO2 business

Tronox Limited has announced a definitive agreement to acquire the TiO₂ business of Cristal, the privately held global chemical and mining company, for US$1.673bn of cash and Class A ordinary shares representing 24% ownership in pro forma Tronox. Concurrently with this announcement, the company announced its intent to begin a process to sell its Alkali business. The cash portion of the purchase consideration is expected to be funded through proceeds from the sale of assets, including the sale of Alkali and selected other non-core assets if appropriate, and cash on hand.

The combination of the TiO₂ businesses of Tronox and Cristal creates the world’s largest and most highly integrated TiO₂ pigment producer with assets and operations on six continents. The combined company will operate 11 TiO₂ pigment plants in eight countries with a total capacity of 1.3Mt/yr and will have titanium feedstock operations in three countries with a total capacity of 1.5Mt/yr.

"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 (pictured). "Because we don’t expect to take on new debt, we project a 50% reduction in our net leverage ratio. EPS accretion of more than 100% is expected in year one and we believe that between 2018 to 2021 our projected pro forma EPS, EBITDA and free cash flow growth rates will improve by approximately 70%, 30% and 60%, respectively, versus Tronox standalone. We believe this combination presents an extraordinary opportunity to build a global leader that will offer the best results to customers, shareholders, creditors and employees.”