TASNEE announces further developments regarding the transaction agreement of selling titanium dioxide business of Cristal to Tronox
4/11/2019

 

 

 

 

 

With reference to TASNEE's previous announcement published on Tadawul on 13/06/1439H corresponding to 01/03/2018, and on 24/05/1438H corresponding to 21/02/2017, regarding its subsidiary (Cristal) entering into a conditioned transaction agreement to sell to Tronox Limited its domestic and international titanium dioxide business, TASNEE confirms today that the U.S. Federal Trade Commission (FTC) has approved Tronox Limited’s proposed acquisition of the titanium dioxide (“TiO2”) business of The National Titanium Dioxide Company Limited (“Cristal”), a TASNEE subsidiary. The FTC issued an Order and Decision allowing the transaction to proceed with the remedy divestiture of Cristal’s North American TiO2 business to INEOS Enterprises, a division of INEOS (“INEOS”).
 
The Cristal transaction with Tronox closed Wednesday night April10 , 2019. Upon closing of this transaction, Cristal will receive a cash consideration of US$1.673 billion and a 24% equity position in Tronox. The cash consideration shall be substantially used to fully prepay the outstanding bank debt of Cristal which is consolidated in TASNEE’s consolidated financial statements. Upon closing of this transaction, TASNEE’s consolidated financial statements for the quarter ending June 30, 2019 shall reflect the deconsolidation of Cristal assets and liabilities, which are part of this transaction and the equity investment in Tronox shall be reported as an investment in an affiliate. The valuation of equity investment in Tronox and financial impact resulting from this transaction shall be determined based on the review of balance sheet at closing date by the independent auditors and reflected in the TASNEE’s consolidated financial statements for the quarter ending June 30, 2019. The two Directors of Tasnee Board, namely Dr. Talal Ali Al Shair (in his personal capacity), and Mr. Ibrahim Al Qadi (in his capacity as the representative of Gulf Investment Corporation “GIC”) own 1% and 20% of Cristal's issued shares, respectively. TASNEE owns 79% of Cristal's issued shares. TASNEE hereby permits such transaction (made through a conditional agreement) which doesn’t include any preferential conditions for the aforementioned two Directors. TASNEE shall announce any further material developments pertaining to the Transaction in due course.
 
TASNEE’s CEO Mutlaq H. Al-Morished commented, “This transaction enables Cristal and Tronox to position the combined businesses for long-term success in the titanium dioxide (TiO2) global industry that will benefit from a fully integrated global asset base and derive significant synergies. This also allows TASNEE to focus on its petrochemical assets, downstream business and other strategic business development opportunities, while substantially deleveraging its consolidated balance sheet.”