Venator Materials UK, a titanium dioxide factory on Teesside in the north-east of England, went into administration last October after more than 50 years of operation, taking 270 jobs with it. Titanium dioxide is an industrial whitening agent used in paints and plastics, but also in defence supply chains and green energy manufacturing – giving the facility significance beyond its size.
This week, the UK’s Competition and Markets Authority cleared the way for China’s LB Group, formerly Lomon Billions Group and the world’s largest producer of titanium dioxide to acquire the plant for $70 million following a three-month review. LB Group has committed to restarting production at the site, with the prospect of restoring hundreds of jobs to an area that has few alternative major employers. The local Unite union representative welcomed the decision, saying the union was looking to “establish a good working relationship with LB Group going forward”.
The Subsidy Problem at the Centre of It All
The approval has drawn sharp criticism from the European Titanium Dioxide ad hoc coalition, which represents nearly 90% of EU production. The group said it was “extremely disappointed” by the decision, warning that LB Group’s acquisition would likely result in a “significant diminution in competition in both the UK and the EU” as the Chinese firm uses its position to make it impossible for European rivals to remain viable.
The concern is specific: LB Group benefits from substantial Chinese state subsidies, which could allow it to sell titanium dioxide into European markets at prices below what it actually costs to produce the product in the UK — a practice known as cross-subsidisation. Three industry insiders told the Financial Times they feared exactly this outcome. The risk is not hypothetical. Tronox, the US owner of the UK’s only other titanium dioxide plant, in Stallingborough, Grimsby, announced in January that it was closing its own Chinese production facilities, citing “continued excess production and unsustainable pricing” from Chinese competitors.
Saving Jobs Today Could Cost an Industry Tomorrow
The Teesside decision puts a sharp point on a dilemma that Western governments are increasingly struggling to resolve. Blocking Chinese investment protects strategic industries but leaves workers unemployed and communities hollowed out. Approving it saves jobs in the short term but potentially hands a subsidised competitor the foothold it needs to undercut the remaining domestic industry until it collapses.
This is the same tension playing out across semiconductors, electric vehicles, solar panels and battery manufacturing sectors where Chinese state backing has repeatedly driven Western producers out of markets they once dominated. Titanium dioxide may lack the headline profile of those industries, but its role in defence and green energy supply chains means the strategic stakes are real.
From where I sit, watching how quickly centralised capital — whether state or corporate — can reshape an entire market once it gains a foothold, the pattern here is familiar. The competition question the CMA examined was whether this specific deal harms competition in a narrow legal sense. The question the broader industry is asking is different: whether allowing heavily subsidised foreign producers to acquire distressed Western assets one by one amounts to a slow unwinding of industrial capacity that no single regulatory decision will ever be held accountable for.
