Tronox Limited (TROX) has signed a definitive agreement to sell its alkali chemicals business to Genesis Energy LP (GEL), a diversified midstream energy master limited partnership headquartered in Houston, Texas, for $1.325 billion in cash.
The transaction is expected to close in the second half of 2017.
The sale of alkali chemicals is the next step in positioning Tronox as the global leader in TiO2. The proceeds will be used to fund the majority portion of the cash consideration for the Cristal TiO2 acquisition, which is expected to close by the first quarter of 2018. As an integral part of this strategy, the company announced its intention to refinance a portion of its capital structure.
"We were pleased to have received significant interest in our alkali business from multiple potential buyers. Genesis' proposal was the most compelling for its overall value, with its combination of price, favourable contract terms, speed to closing, committed financing, and expected ease of regulatory approvals. These considerations, in aggregate, provided the highest level of certainty to Tronox. We anticipate being able to close this transaction prior to our planned closing of the Cristal TiO2 acquisition,” said Peter Johnston, CEO of Tronox.
"Alkali chemicals has consistently delivered strong operational and financial performance. The caliber of the alkali workforce and their commitment to safe, high-quality production are unmatched in the natural soda ash industry. I thank the leadership team and all alkali employees for their contributions to Tronox," added Johnston.
Read more: Tronox to sell alkali chemicals business for $1.3 bn cash
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