Tronox acquire Exxaro’s Mineral Sands operations

Tronox to acquire Exxaro’s Mineral Sands operations

5:40 AM, 27th September 2011
Tronox to acquire Exxaro’s Mineral Sands operations
Dennis L Wanlass, CEO, Tronox.


OKLAHOMA CITY, US/PRETORIA, SOUTH AFRICA: Tronox Incorporated has agreed to acquire Exxaro’s mineral sands operations, which include Exxaro’s 50 per cent interest in the Tiwest joint venture with Tronox in Western Australia, along with 74 per cent of Exxaro’s KZN Sands and 74 per cent of its Namakwa Sands operations in South Africa, in exchange for approximately 38.5 per cent of Tronox’s equity.

Exxaro’s mineral sands operations produce the key titanium bearing ore feedstock used in the production of titanium dioxide pigment. The transaction is expected to close in the first half of calendar 2012, subject to approvals. The combined entity will benefit from synergies and an accelerated growth profile.

Combined trailing 12 month revenues were $2 billion and EBITDA was $495 million (excluding any synergies). With addition of 50 per cent interest in Tiwest, Tronox’s production capacity will increase to approximately 465 thousand tonne of titanium dioxide pigment and will be backward integrated with production capacity of approximately 95 thousand tonne of natural rutile, approximately 380 thousand tonne of slag and approximately 220 thousand tonne of synthetic rutile all of which are materials that can be used in the production of titanium dioxide. In addition, Tronox will have the capacity to produce a number of other minerals including approximately 265 thousand tonne of zircon and approximately 220 thousand tonne of pig iron.

“This transaction combines Tronox’s best-in-class pigment production operations and leading proprietary technology with Exxaro’s highly technical expertise and globally competitive mineral sands operations to outperform through all points of the business cycle. Combining this vertically integrated source of ore, along with our existing contracts with other ore producers, ensures Tronox will have the necessary feedstock to support our growth strategies in the years to come,” said Dennis L Wanlass, CEO, Tronox.

“An integrated model has always been part of Exxaro’s mineral sands strategy. Key among the contributions that Exxaro will bring to this transaction are its long life mineral resources, mining and processing expertise, world-class direct current furnace ilmenite smelting technology, strong minerals research and development capabilities and proprietary slimes handling capabilities,” said Sipho Nkosi, CEO, Exxaro.

“The transaction will improve the future potential for South Africa to be chosen as a site for a potential new greenfield pigment plant as the demand increases and growth strategies are formulated,” he added.

To effectuate the transaction Tronox will form a new Australian-domiciled holding corporation (New Tronox) to combine its assets with Exxaro’s mineral sands operations.

(C) WOC News




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