FMC’s Alkali division provides trona-based products to a variety of industries such as glass manufacturing, water treatment,
pulp and paper, textiles, food and pharmaceuticals.

The companies expect the transaction to close in the first quarter of 2015.

In September 2014, FMC announced it was acquiring multinational agrochemical maker Cheminova A/S and would pursue a divestiture of the Alkali Chemicals business to reduce debt related to the acquisition. Regarding sale of the business to Tronox, FMC CEO and Chairman Pierre Brondeau said, “This is a natural fit for Alkali Chemicals, which will thrive as a new, strategic business at Tronox. The transaction allows FMC to maintain a strong balance sheet as our company focuses on global agriculture, health and nutrition with a portfolio that concentrates on high-growth markets.”

Tronox Chairman and CEO Tom Casey said, “Together, Tronox and Alkali Chemicals will form a leading inorganic chemicals company, with more stable revenue, cash flow, and EBITDA streams and higher net income. We will have approximately $2.6 billion in sales, with the scale, stability and financial strength to pursue our strategic growth initiatives.

“We will operate Alkali Chemicals as a separate business unit and reporting segment. Alkali Chemicals brings to Tronox more than 1,000 new colleagues and a senior management team that averages 23 years of experience in the chemicals industry and 13 years of experience with Alkali Chemicals. One of the most important elements in our decision to acquire Alkali Chemicals is the excellence of the employees and management team. We look forward to joining with them to build a great company from the ground up.”

Tronox anticipates after-tax cash synergies of more than $30 million in the first year following completion of the transaction, growing to more than $60 million annually by year three, including utilization of Tronox’s U.S. tax attributes.

Commenting on soda ash industry fundamentals, the Tronox announcement remarked that the soda ash industry has shown stable market demand and low risk of supply overhang for cost-advantaged producers. Global demand for natural soda ash currently exceeds available production, and natural soda ash currently enjoys a favorable cost position relative to synthetic producers in export markets on a delivered cost basis. The U.S. market works predominantly under long-term contracts, with a high level of visibility into forecast sales for 2015 and 2016. The majority of export sales are made through American Natural Soda Ash Corp., a sales, marketing, and distribution cooperative of three companies that have operations in the Green River basin: FMC; Tata Chemicals (Soda Ash) Partners; and OCI Chemical Corp.