Tronox Boosts Feedstock Access with TTI Buy
2020-05-26    [Source:CHEManager]

PUdaily Shanghai —— Leading titanium dioxide (TiO2) producer Tronox has agreed to buy the TiZir Titanium and Iron (TTI) business from Eramet, a French multinational mining and metallurgy group, for about $300 million.


    TTI’s facility in Tyssedal, Norway, upgrades ilmenite to high-grade titanium slag and high-purity pig iron, respectively producing approximately 230,000 t/y and 90,000 t/y.


    “This highly strategic acquisition represents the next step in advancing our vertical integration strategy, providing Tronox with increased titanium feedstock capacity to better fulfill our internal requirements, and in turn, better serve our pigment customers with a low-cost, secure source of supply. The site is ideally situated to supply feedstock to our European pigment facilities,” said Tronox chairman and CEO Jeffry Quinn.


    He added: “The technology and manufacturing capabilities acquired will lower our cost of obtaining the feedstocks we need to run our pigment plants, broaden the geographic diversity of our titanium feedstock operations, and improve the likelihood of a successful commissioning, ramp up, and eventual acquisition of the Jazan smelter.”


    In May 2018, Tronox entered into a deal with Saudi Arabia’s Advanced Metal Industries Cluster Company (AMIC) to acquire 90% of the Jazan titanium smelter, which has capacity to supply up to 500,000 t/y of titanium slag and 220,000 t/y of pig iron.


    AMIC is equally owned by pigment producer Cristal, which Tronox acquired in April 2019, and Saudi conglomerate Tasnee.


    As part of the deal with Eramet, Tronox has agreed to source ilmenite for the TTI facility from the French company’s Grande Côte mineral sands mine in Senegal.


    For the first two years, Tronox expects the Grande Côte mine to supply substantially all of TTI’s needs but the US pigment producer said the volumes will reduce throughout the term of the agreement, giving it the flexibility to supply TTI from its own assets or other sources.


    The boards of both Tronox and Eramet have unanimously approved the transaction, which remains subject to certain consents, customary closing conditions and regulatory approvals.


    The acquisition is expected to achieve run-rate synergies of between $15 million and $20 million in year three.

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