25 September 2009 21:12 [Source: ICIS news]
HOUSTON (ICIS news)--Bankrupt US titanium dioxide (TiO2) producer Tronox did not comment on Friday on a lawsuit filed against it by titanium producer RTI Hamilton, who claimed that Tronox hid its weak financial health when the two companies signed a titanium tetrachloride supply agreement in March 2008.
RTI said if it had known Tronox was an insolvent company at the time, it would have sought an agreement with another TiO2 producer.
RTI had planned to build a titanium sponge plant adjacent to Tronox’s TiO2 plant in ?xml:namespace>
As part of the effort, Tronox agreed to upgrade its facility to provide the feedstock at a high-enough quality for RTI, which produces titanium products for defence and commercial applications.
But Tronox did little to adapt its plant to manufacture titanium tetrachloride, except for some modest preliminary engineering, RTI alleged.
As such, the supply agreement and ground lease should be rescinded and declaratory relief should be granted by the bankruptcy court, because Tronox did not disclose its financial problems during negotiations, RTI said.
Huntsman submitted the initial bid. Spokesman Russ Stolle said his company was not in a position to comment on the litigation.
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