Millennium Chemicals to Acquire Brazilian TiO2 Operations

Millennium Chemicals Inc. has agreed to buy a majority share of two titanium dioxide (TiO₂) operations in Brazil, consisting of a 60,000 metric ton per year TiO₂ plant and a mineral sands mine with over 2 million metric tons of recoverable reserves. Millennium has agreed to purchase Constructora Andrade Guttierrez S.A.'s and Bayer S.A.'s equity interests in Titananio do Brazil S.A. (Tibras), which represents 72% of the outstanding equity capital of Tibras and 99% of its voting shares.

Tibras, a publicly traded Brazilian company, produces TiO₂ by the sulfate process at its 60,000 metric tons per year, ISO 9002 certified plant at Salvador, Bahia, on the Northeast coast of Brazil. This plant is vertically integrated, with its titanium ore mine located at Mataraca, Paraiba. The mine, with over 2 million metric tons of recoverable reserves, produces over 100,000 metric tons of titanium ores and over 16,000 metric tons of zircon per year.

With Tibras, Millennium will be the market leader in Brazil and the second-largest supplier to South America. TiO₂ demand in Brazil is expected to continue to outpace average worldwide growth rates. Over the past 10 years, Brazil's TiO₂ demand has grown an average of 5.2% per year.

Millennium expects to have 712,000 metric tons per year of TiO₂ capacity beginning in 1999, with the completion of the 41,000 metric ton per year United Kingdom plant expansion in early 1999 and the successful integration of both Tibras in mid-year 1998 and two French plants acquired from Rhone-Poulenc Chimie S.A. acquired at year-end 1997.

Edited by Beth Brindle