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Exxaro vends mineral sands into US pigment producer

Exxaro
 

Exxaro Resources Ltd has announced a deal in which the company will inject its mineral sands mining assets into US-based Tronox Incorporated, creating a vertically-integrated pigment producer.
Tronox will issue an approximate 38.5% stake to Exxaro in exchange for the assets, which include 74% of Namakwa Sands and KZN Sands in South Africa and 50% of the Tiwest Joint Venture in Australia.

Tronox is already the joint venture partner in Australia. Dennis L. Wanlass, Tronox’s Chief Executive Officer, said: “Our two companies already have a strong, well-established 20-year partnership and a proven track record of enhancing production capabilities and implementing technical efficiencies in the integrated pigment process at our Tiwest joint venture operation in Western Australia.”
Exxaro will retain 26% of the South African operations under the country's black ownership requirements.
Using a 30-day average Tronox share price, the combined entity, “New Tronox”, would have an estimated value of R27.8 billion (US$3.36 billion).
The company said: “Exxaro believes that its mineral sands business is best configured as an integrated mining-to-processing-to-pigment business and has been evaluating various opportunities over the past four years.”
The board will have nine members, with Exxaro having the right to chose three non-executive directors.
The transaction is expected to close in the first half of calendar 2012.

 
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