RIYADH, 12 June 2007 — A major Saudi company, in which Prince Alwaleed bin Talal, chairman of the Kingdom Holding Company (KHC) is a majority shareholder, has signed here yesterday a SR4.5 billion acquisition of Lyondell’s Inorganic Chemicals Business. Alwaleed witnessed the signing of the deal, which makes the combined Saudi Arabia’s Cristal and Lyondell operations the second largest titanium dioxide company in the world.
The accord was inked by Dr. Talal Shaair, chairman of Cristal (National Titanium Dioxide Company), and Dan Smith, CEO & president of Lyondell’s. The deal will facilitate the acquisition of nine factories in six countries belonging to Lyondell’s with headquarters in the US.
Cristal is 66 percent owned by the National Industrialization Company (Tasnee) in which Alwaleed holds a major stake, while GIC, a Kuwait-based investment house owns 33 percent.
Addressing a press conference at the KHC’s headquarters, Alwaleed said “Cristal and Lyondell’s, together, have become the second largest global producer of titanium products with the most diverse manufacturing platform. Our global depth and breadth allow us to better meet customer needs worldwide and position us for long-term success in the titanium dioxide industry.”
The prince said that Cristal will retain Lyondell’s headquarters in Hunt Valley, Maryland. He said “the acquisition symbolizes the strong Saudi partnership with foreign business entities, a process that supports the growth of all sectors of economy.” In fact, Lyondell’s and Cristal, on Feb. 26 this year, announced that they have agreed for a proposed sale by Lyondell of its worldwide inorganic chemicals business to Cristal in a transaction valued at approximately SR4.5 billion.
Shaair said “Cristal has emerged a major global producer of titanium dioxide exporting to more than 70 countries.” Lyondell’s is the world’s second-largest producer of titanium dioxide, with an annual capacity of 670,000 metric tons. Titanium dioxide is a white pigment commonly used in such consumer products as paint, toothpaste and sunblock.
He said Cristal, a privately held Saudi company, intends to continue operating the assets it will acquire from Lyondell. “The acquisition is an exciting component of our continued growth story and increases our global presence as we will gain facilities in Europe and Australia as well as North and South America,” Shaair pointed out. Approximately 2,900 employees are affiliated with the Lyondell’s chemicals business alone.
Samuel R. Alexander, Cristal’s vice president, said “all regulatory clearance from foreign government agencies have been obtained with 100 percent compliance with labor and employment regulations, and other conditions that are typical for transactions of this type.” He added that Lyondell is a leading global manufacturer of chemicals and plastics, a refiner of heavy, high-sulfur crude oil and a producer of fuel products.
Lyondell’s key products include ethylene, polyethylene, styrene, propylene, propylene oxide, titanium dioxide, gasoline, ultra low-sulfur diesel, MTBE and ETBE. Lyondell’s, as a holding company, operates on five continents and employs nearly 11,000 people worldwide. On the other hand, Cristal is the ninth-largest titanium dioxide producer globally, with a current production capacity of 100,000 metric tons, and an authorized design production capacity of 180,000 tons. With major offices in Saudi Arabia, the UK and Singapore, it is the only producer of titanium dioxide in the Middle East and North Africa and it currently exports its products to more than 70 countries across the globe.
The company has been a leader in employee safety and environmental-friendly manufacturing processes. Tasnee owns 66 percent of Cristal, while 33 percent of Cristal is owned by GIC, an investment house established in Kuwait by the GCC countries.
