Exxaro sets price for Tronox stake


Exxaro sets price for Tronox stake


Published Date: 2021-02-26 | Source: Stephen Gunnion | Author: Stephen Gunnion

Exxaro sets price for Tronox stake

The diversified resources group plans to use the proceeds from the disposal to reduce debt and invest in renewable energy projects.

Exxaro Resources has increased the number of shares it plans to sell in Tronox Holdings to 19.1-million from the 17-million it initially planned to dispose of. If the underwriters of the transaction take up their option to buy shares, it will exit its investment entirely.

The disposal is in line with Exxaro's strategy to monetise its stake in the titanium dioxide company over time. It already sold almost half its stake in the New York Stock Exchange-listed company in November 2017.

Tronox is the world's leading integrated manufacturer of titanium dioxide pigment, globally engaged in the mining, production and marketing of inorganic minerals and chemicals.

The diversified resources group appointed JP Morgan, Band of America (BofA) Securities, Deutsche Bank Securities and Morgan Stanley as joint book-running managers and underwriters for the offering and granted them a 30-day option to purchase up to 2.55-million additional Tronox shares at the public offering price.

Exxaro said the shares were being offered at $18.25 each for total net proceeds of about $332 million, after deducting underwriting discounts and commissions. Following the disposal, it said its ownership would reduce to the Option Shares, representing about 1.9% of Tronox's outstanding shares.

Last year, Exxaro bought out joint-venture partner Khopoli Investments to take 100% ownership of Cennergi, which owns wind farms in the Eastern Cape and sells electricity to Eskom.

The company's shares closed 0.3% up at R175.98 yesterday.


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