Judge blocks Tronox-Cristal tie-up

By William Clarke
Published: Monday, 22 October 2018

A US court has stalled the takeover to give the FTC time to complete its own review of the deal.

A US court has issued a preliminary injunction, stalling Tronox’s takeover of rival titanium dioxide producer Cristal.

The injunction was requested by the Federal Trade Commission (FTC), which has opposed the deal due to fears it will decrease competition in the titanium dioxide market, specifically in the market for high-grade chloride-route pigment, leading to higher prices for consumers.

The planned takeover comes at a time when titanium dioxide pigment prices are rising due to reduced Chinese output and increased global demand. Fastmarkets IM assessed titanium dioxide pigment prices, bulk volume, cif United States, at $3,100-3,400 per tonne on September 20, its highest in at least two years, and up by 7% year on year.

The injunction will prevent Tronox from completing the $2.4 billion tie-up before a decision has been reached by the FTC’s in-house administrative process.

Tronox says it intends to appeal this decision, but is also considering proceeding with the divestment of Cristal’s Ashtabula plant in Ohio, to Venator, Tronox’s attempt to reduce its share in the US titanium dioxide market.