Tronox exits electrolytic operations
On March 21, 2018, Tronox (TROX) announced that it will sell certain assets and liabilities of its Electrolytic Operations to EMD Acquisition. In an all-cash deal, Tronox will receive $13 million. The transaction is expected to be completed in mid-2018—subject to closing conditions. Tronox intends to exit its non-core business and focus on its titanium dioxide business.
Jeffry N. Quinn, Tronox’s president and CEO, said, “As we focus on our evolution into a leading global producer of titanium dioxide, we are pleased to find a long-term investor to purchase this non-core business.”
In another development related to the Cristal TiO2 acquisition, on March 20, 2018, Tronox received objections from the European Commission. Tronox will work with regulators towards a resolution. Tronox has until April to respond to the objections.
Update on Tronox’s stock price
The sell-off in US markets due to increasing trade wars concerns resulted in the biggest weekly decline in two years. Tronox’s stock price declined 6.2% and closed at $18.23. As a result, the stock traded 15.7% lower than the 100-day moving average price of $21.62, which indicates a downward trend in the stock. On a year-to-date basis, the stock has declined 11.1%. Chemours (CC), FMC (FMC), and W.R. Grace (GRA) fell 5.9%, 20.2%, and 13.9%, respectively. However, Tronox’s 14-day relative strength index of 40 indicates that the stock isn’t overbought or oversold.
Investors could hold Tronox indirectly by investing in the Rare Earth/Strategic Metals ETF (REMX). REMX has invested 4.6% of its portfolio in Tronox as of March 23, 2018.