In yet another blow for the proposed Tronox-Cristal titanium dioxide (TiO₂) merger, a US Federal Trade Commission (FTC) administration law judge has ruled that the deal would substantially lessen competition for the sale of chloride-based pigment.

Although Tronox said it was disappointed, the decision does now mean that the US producer can work directly with the FTC and seek Commissioners’ approval to the proposed remedy, something it was not allowed to do prior to the ruling.

The previously proposed remedy comprises Tronox selling its complex and associated assets at Ashtabula, Ohio in the US to Ineos. Tronox announced earlier this month that it wanted to sell the site for $700 million to Ineos, a potential new entrant into the TiO2 market.

“As the owner of Ashtabula, Ineos would be a strong competitor with the expertise to increase output and efficiency, bringing a new energy to the TiO₂ industry in a way that would benefit consumers,” said Jeffry Quin, president and CEO of Tronox.

The two plants and related assets at Ashtabula would be held separate during an interim period while the proposed divestment is pending. In addition, Tronox and Cristal’s North American TiO₂ production would continue to be operated independently, meaning there would be no increase in industry concentration. This, said Tronox, would eliminate the risks of anticompetitive effects that the FTC alleged in its original complaint.

Tronox has already received approval for the deal from eight other regulators, including the European Commission.