Stay current on the latest developments from agencies including the CFPB, Federal Reserve, FDIC, and OCC to advise clients on real-life regulatory situations.
Tronox Ltd.'s $1.67 billion bid for Cristal’s titanium dioxide business won approval from European Union competition authorities on Tronox’s pledge to divest assets related to a specific chemical for paper laminate.
The EU Competition Commission announced July 4 that it had cleared the deal after an in-depth investigation found potential competition problems in a single market, chloride-based titanium dioxide pigment for use in paper laminate. Tronox’s offer to sell its global business in titanium dioxide pigment for paper laminate to an experienced manufacturer eased the EU’s only concerns about the deal.
Titanium dioxide is widely used as white pigment in products ranging from paint and sunscreen to ceramic glazes and inks.
Tronox’s purchase of Cristal (also known as The National Titanium Dioxide Co. Ltd.) puts it ahead of Chemours Co. as “the world’s largest and most highly integrated TiO2 pigment producer with assets and operations on six continents,” according to the companies’ Feb. 21, 2017, announcement of the deal.
Tronox said at the time that the combined company will operate 11 titanium dioxide plants in eight countries “with a total capacity of 1.3 million metric tons per annum and will have titanium feedstock operations in three countries with a total capacity of 1.5 million metric tons per annum.”
The EU looked into whether the deal would have anticompetitive impacts in the pigment and feedstock markets and also examined potential effects in the market for zircon, which is used in the production of tiles, ceramics, and fire bricks. Authorities concluded that all three markets are competitive and customers could look to many other sources if the combined entity tried to raise prices.
The deal can’t close yet because it faces significant hurdles to clearance in the U.S.
The Federal Trade Commission filed a complaint against the merger in December 2017. The FTC alleged that the deal would reduce competition in chloride process titanium dioxide in the U.S. and Canada by increasing “risk of coordinated action” among the remaining few competitors and by raising the risk that Tronox could unilaterally withhold supply to boost prices.
The deal is presumptively illegal because Tronox and Cristal are two of the three biggest producers in the U.S. and Canada and, combined with the third, Chemours, would concentrate far too much market power in a duopoly if Tronox and Cristal are allowed to merge, according to the FTC.
The risk of coordination is not an abstract concern. The world’s largest titanium dioxide makers faced a long-running class action in the U.S. alleging they operated as a cartel raising prices in parallel at least 17 times between 2005 and 2010.
Administrative Law Judge Michael Chappell held a multiweek bench trial in the case in May and June. The parties are due to file any post-trial briefs by Aug. 7.
To contact the reporter on this story: Eleanor Tyler in Washington at email@example.com
To contact the editor responsible for this story: Fawn Johnson at firstname.lastname@example.org
Copyright © 2018 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)