STAMFORD, Conn., May 14, 2020 /PRNewswire/ -- Tronox Holdings
plc (NYSE:TROX) ("Tronox" or the "Company"), a leading integrated
manufacturer of titanium dioxide pigment, today announced that it
has signed a definitive agreement to acquire the TiZir Titanium and
Iron ("TTI") business from Eramet S.A., a publicly traded French
multinational mining and metallurgy company, for approximately
$300 million. TiZir's TTI facility,
located in Tyssedal, Norway,
upgrades ilmenite to produce high-grade titanium slag and
high-purity pig iron with an annual capacity of approximately
230,000 tons and 90,000 tons, respectively.
"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," commented Jeffry N.
Quinn, chairman and chief executive officer of Tronox.
"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. TTI is a great complement to Tronox because of a shared
focus on operational excellence, safety and sustainability. We are
excited about the opportunities created by the addition of this
well-established, high-quality asset to the Tronox portfolio,"
added Mr. Quinn.
As part of the transaction, Tronox will enter a supply agreement
with Eramet's Grande Côte Operations mineral sands mine in
Senegal to provide Grande Côte's
ilmenite to TTI. For the first two years, Tronox expects the
Grand Côte mine will supply substantially all of TTI's
requirements, but the volumes sold reduces throughout the term of
the agreement, allowing Tronox the flexibility to supply TTI from
its own mineral sands assets or other sources.
The $300 million purchase price
represents a synergy-adjusted multiple of approximately 5.2x FY
2019 Adjusted EBITDA and will be funded with cash from the balance
sheet. The transaction is expected to achieve $15-20 million in run-rate synergies in
year three. The transaction has received the unanimous approval of
the Tronox and Eramet boards of directors and is subject to certain
consents and customary closing conditions including regulatory
approvals.
Credit Suisse is acting as financial advisor to Tronox for the
transaction and Cleary Gottlieb
Steen & Hamilton LLP and Wikborg Rein are Tronox's legal
advisors.
About Tronox
Tronox Holdings plc is one of the world's leading producers of
high-quality titanium products, including titanium dioxide pigment,
specialty-grade titanium dioxide products and high-purity titanium
chemicals; and zircon. We mine titanium-bearing mineral sands and
operate upgrading facilities that produce high-grade titanium
feedstock materials, pig iron and other minerals. With nearly 7,000
employees across six continents, our rich diversity, unmatched
vertical integration model, and unparalleled operational and
technical expertise across the value chain,
position Tronox as the preeminent titanium dioxide
producer in the world. For more information about how our products
add brightness and durability to paints, plastics, paper and other
everyday products, visit Tronox.com.
About Eramet
Eramet, a global mining and metallurgical group, is a key player
in the extraction and valorisation of metals (manganese, nickel,
mineral sands) and the elaboration and processing of alloys with a
high added value (high-speed steels, high-performance steels,
superalloys, aluminum and titanium alloys). The Group supports the
energy transition by developing activities with high growth
potential, including recycling and the extraction and refining of
lithium. Eramet positions itself as the privileged partner of its
customers in sectors that include carbon and stainless steel,
aerospace, pigments, energy, and new battery generations. Building
on its operating excellence, the quality of its investments and the
expertise of its employees, the Group leverages an industrial,
managerial and societal model that is virtuous and value-accretive.
As a contributive corporate citizen, Eramet strives for a
sustainable and responsible industry. Eramet employs around 13,000
people in more than 20 countries with sales of c.€4 billion in
2019. For further information, go to www.eramet.com
Forward Looking Statements
Statements in this release that are not historical are
forward-looking statements within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995. These forward-looking
statements, which are subject to known and unknown risks,
uncertainties and assumptions about us, may include projections of
our future financial performance including the effects of the
COVID-19 pandemic and anticipated synergies based on our growth and
other strategies and anticipated trends in our business. These
statements are only predictions based on our current expectations
and projections about future events. There are important factors
that could cause our actual results, level of activity,
performance, actual synergies, or achievements to differ materially
from the results, level of activity, performance, anticipated
synergies or achievements expressed or implied by the
forward-looking statements. Significant risks and uncertainties may
relate to, but are not limited to, the risk that a regulatory
approval that may be required for the Transaction is delayed, is
not obtained or is obtained subject to conditions that are not
anticipated; the risk that the Transaction does not close or that
the Transaction Agreement is terminated; the risk that expected
synergies, operating efficiencies and other benefits expected from
the Transaction will not be realized or will not be realized within
the expected time period; business and market disruptions related
to the COVID-19 pandemic, market conditions and price volatility
for titanium dioxide, zircon and other feedstock materials, as well
as global and regional economic downturns, including as a result of
the COVID-19 pandemic, that adversely affect the demand for our
end-use products; disruptions in production at our mining and
manufacturing facilities; and other financial, economic,
competitive, environmental, political, legal and regulatory
factors. These and other risk factors are discussed in the
Company's filings with the Securities and Exchange Commission
(SEC).
Moreover, we operate in a very competitive and rapidly changing
environment. New risks and uncertainties emerge from time to time,
and it is not possible for our management to predict all risks and
uncertainties, nor can management assess the impact of all factors
on our business or the extent to which any factor, or combination
of factors, may cause actual results to differ materially from
those contained in any forward-looking statements. Although we
believe the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results,
level of activity, performance, synergies or achievements. Neither
we nor any other person assumes responsibility for the accuracy or
completeness of any of these forward-looking statements. You should
not rely upon forward-looking statements as predictions of future
events. Unless otherwise required by applicable laws, we undertake
no obligation to update or revise any forward-looking statements,
whether because of new information or future
developments.
Media Contact: Melissa Zona
+1.636.751.4057
Investor Contact: Jennifer
Guenther
+1.646.960.6598
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SOURCE Tronox Holdings plc