Slide 1: Exxaro Mineral Sands Acquisition Investor Presentation
EXXARO MINERAL SANDS ACQUISITION Investor Presentation September 26, 2011
Slide 2: Forward-looking statements
This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are typically identified by words or phrases such as “may,” “will,” “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “ta
Slide 3: Tronox to acquire Exxaro's mineral sands operations
Tronox to acquire Exxaro’s mineral sands operations, creating the world’s largest vertically-integrated titanium dioxide (TiO2) pigment company Exxaro to receive approximately 38.5% equity stake in Tronox in exchange for its mineral sands operations Combined 6/30/11 LTM revenue of $2.0 billion and E
Slide 4: Transaction overview: shares issued to Exxaro for KZN Sands, Namakwa Sands and Tiwest
Tronox issuing shares to Exxaro in exchange for KZN Sands, Namakwa Sands and Exxaro’s 50% interest in Tiwest Approximately 38.5% of fully diluted equity will be owned by Exxaro; 25.9 million fully diluted pro forma shares outstanding Exxaro to retain 26% direct interest in South African businesses t
Slide 5: Tronox and Exxaro facilities and capacities
Tronox Pigment Facilities Location Capacity (MT) Hamilton 225,000 Botlek 90,000 Tronox Electrolytic Facilities Location Capacity (MT) Hamilton (Sodium Chlorate) 150,000 Henderson (EMD) 27,000 Henderson (Boron Products) 525 Tiwest Joint Venture Facilities 1 Location Capacity (MT) Kwinana 150,000 Nort
Slide 6: Tronox Will Benefit from Strong Earnings Momentum
Tronox Will Benefit from Strong Earnings Momentum Combined EBITDA Margin
Slide 7: Strategic and financial benefits
Brings together two global leaders in the TiO2 pigment value chain with complementary businesses and strengths Creates world’s largest vertically-integrated TiO2 pigment company Approximately 3,500 total employees in 16 locations around the world Enhanced supply of high-grade ore in tight market con
Slide 8: Compelling Strategic and Financial Benefits (cont'd)
Compelling Strategic and Financial Benefits (cont’d) Creates a company with greater scale, higher margins and improved growth prospects Integrated platform will benefit from cost savings and synergies estimated to be approximately $30 million annually Rationalization of G&A and ore logistics Ore in-
Slide 9: Company Overview: Tronox
Company Overview Global pure play TiO2 producer 5th largest TiO2 producer and marketer with 8%1 share of global capacity Focused primarily on coatings, plastics and paper laminates Efficient, low-cost manufacturing footprint Global operations and international presence Specialty electrolytic chemica
Slide 10: Exxaro Mineral Sands overview
3rd largest titanium ore feedstock producer globally (11% market share) with 3 producing assets 3rd largest zircon producer globally (18% market share) Geographically well-positioned to serve markets in Asia, the Middle East, Europe, North and South America KZN Sands’ development of Fairbreeze mine
Slide 11: Global TiO2 pigment market
Global TiO2 pigment market: 5.3 million tonnes valued at $11.9 billion in 2010 Current supply dynamics and projected demand increases should lead to continued improving economics with limited significant capacity expansions Multiple price increases in 2010 and 2011 and all major producers operating
Slide 12: Transaction assures ore supply
Transaction assures ore supply for Tronox, and hence revenue and EBITDA growth Pigment production growth will continue to be major driver of global demand for ore TiO2 producers’ growth will be limited by availability of feedstock Chloride feedstock expected to run into increasing deficits without s
Slide 13: Combined financials and pro forma capital structure
Combined 6/30/11 LTM revenue of $2.0 billion and EBITDA of $495 million (25% margin) Conservative pro forma capital structure with significant financial flexibility to fund growth No incremental debt being transferred with the acquired assets Tronox has obtained $550 million of committed financing f
Slide 14: Tronox Will Become Leading Vertically Integrated TiO2 Producer
Tronox Will Become Leading Vertically Integrated TiO2 Producer Leading global, vertically-integrated TiO2 pigment producer Leading company with access to diverse and growing global markets Enhanced ore supply and reduced earnings volatility due to ore availability / raw material price fluctuations A
Slide 15: Appendix
Appendix
Slide 16: Transaction Detail
Transaction DetailDetail Current Tronox shareholders to exchange existing common stock for new Class A common stock in Australian-domiciled corporation (“New Tronox”) and $12.50 per share Option to receive exchangeable shares with right to exchange later into Class A shares and $12.50 per share, sub
Slide 17: Transaction Detail (cont'd)
Transaction Detail (cont’d) Pro Forma Shares Outstanding 25.9 million shares outstanding (excluding Exxaro’s put/call shares) Intention to list on a major exchange, such as the NYSE, after closing Board of Directors 9 member board comprising: 6 Class A Directors (including the CEO of Tronox) and 3 C
Slide 18: Tronox tax attributes and NOLs
Tronox should retain much of the deductions for tax purposes it presently has available it including historical NOLs Tax attributes appear to be worth at least $300 million on a Net Present Value basis These tax attributes (which are subject to audit by IRS) consist of: Preexisting NOLs Tax deductio
Slide 19: Zircon Market Fundamentals
Zircon Market Fundamentals Opacifiers in Ceramics Floor and wall tiles, sanitary ware and table ware Refractory & Foundry Steel / glass production and casting of jet turbine engines Zirconium Metal Nuclear reactor cores / rods and heat exchangers Zirconia & Zirconium Based Chemicals Refractories, pi
Slide 20: Financial Reconciliation
Financial Reconciliation LTM 2008 2009 2010 6/30/2011 1H 2010 1H 2011 Tronox Revenue $1,245 $1,070 $1,218 $1,441 $580 $803 Exxaro Revenue 334 419 636 772 284 420 Less: Pro Forma Intercompany Eliminations (125) (141) (176) (241) (82) (147) Combined Revenue $1,454 $1,348 $1,678 $1,972 $782 $1,076 Tron
Slide 21: Tronox EBITDA Reconciliation
Tronox EBITDA Reconciliation Unaudited LTM 2008 2009 2010 6/30/2011 1H 2010 1H Net income (loss) ($328) ($52) $6 $643 $71 $ Interest and debt expense 54 36 50 41 25 1. The Company has incurred costs related to the Chapter 11 bankruptcy proceedings. These items include cash and non-cash charges relat
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[Graphic Appears Here]