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<SEC-DOCUMENT>0000059255-08-000172.txt : 20090109
<SEC-HEADER>0000059255-08-000172.hdr.sgml : 20090109
<ACCEPTANCE-DATETIME>20081114125306
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0000059255-08-000172
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20081114

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			VALHI INC /DE/
		CENTRAL INDEX KEY:			0000059255
		STANDARD INDUSTRIAL CLASSIFICATION:	INDUSTRIAL INORGANIC CHEMICALS [2810]
		IRS NUMBER:				870110150
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		5430 LBJ FRWY
		STREET 2:		STE 1700
		CITY:			DALLAS
		STATE:			TX
		ZIP:			75240
		BUSINESS PHONE:		9722331700

	MAIL ADDRESS:	
		STREET 1:		THREE LINCOLN CENTER
		STREET 2:		5430 LBJ FREEWAY SUITE 1700
		CITY:			DALLAS
		STATE:			TX
		ZIP:			75240

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	LLC CORP
		DATE OF NAME CHANGE:	19870329

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	LIBERTY LOAN CORP
		DATE OF NAME CHANGE:	19800414
</SEC-HEADER>
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
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Inc.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5430
LBJ Freeway, Suite 1700</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Dallas,
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14, 2008</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">U.S.
Securities and Exchange Commission</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">100 F
Street, N.E.</font></div>
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7010</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Washington,
D.C. 20549</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Attention:&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Mr.
Terence O&#8217;Brien</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;</font>&#160;&#160;&#160;&#160;</font>&#160;Accounting
Branch Chief</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">CC:&#160;&#160;&#160;&#160;&#160;Ms.
Melissa N. Rocha</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Division
of Corporation Finance</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Ms.
Jeanne Baker</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Division
of Corporation Finance</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Mr.
Hagen Ganem</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Division
of Corporation Finance</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Ms.
Pamela A. Long</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Division
of Corporation Finance</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">RE:&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Valhi,
Inc.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>Form 10-K for Fiscal Year Ended
December 31, 2007, filed on March 13, 2008</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>&#160;&#160;(&#8220;Form 10-K&#8221;)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>Definitive Proxy Statement on Schedule
14A, filed on April 29, 2008</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>&#160;(&#8220;Definitive Proxy
Statement&#8221;)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>File No. 1-5467</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Dear Mr.
O&#8217;Brien</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Reference
is made to the Staff&#8217;s letter dated November 5, 2008, (the &#8220;Comment Letter&#8221;),
which sets forth comments of the Staff regarding the above referenced Form 10-K
and Definitive Proxy Statement.&#160;&#160;Valhi, Inc. (&#8220;Valhi&#8221;) has responded
to the Comment Letter as follows.&#160;&#160;The responses are numbered to
correspond to the numbers of the Comment Letter.</font></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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          <div id="GLFTR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
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1</font></div>
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            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Form 10-K for the Fiscal
Year Ended December 31, 2007</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Item 1.
Business</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Segments</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Component Products Segment &#8211;
CompX International Inc.</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 27pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
      note from your risk factors entitled &#8220;Our failure to enter into new
      markets with our current component products business&#8230;&#8221; and &#8220;Our
      development of new component products&#8230; is critical&#8230;&#8221; that you consider the
      development of new component products and innovative features to be
      critical to sustain and grow your Component Products Segment
      sales.&#160;&#160;If research and development activities are material to
      this segment, please revise the narrative description of your business in
      future filings to discuss these activities, and disclose the estimated
      amount spent during each of the last three fiscal years on research and
      development in this segment.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We hereby
advise the Staff that the amount of the research and development expenditures of
our Component Products segment, pursuant to the guidance of paragraph 9 of SFAS
2, are not material.&#160;&#160;Such expenditures were approximately $.2 million
in each of 2005, 2006 and 2007.&#160;&#160;&#160;However, our Component Products
segment spends a significant amount of time and effort to refine, improve and
adapt its existing products and features for new customers and customer
applications. &#160;Pursuant to the requirements of paragraph 10 of SFAS 2,
expenditures for these types of activities are not considered to be research and
development activities. &#160;Therefore, the amount of the research and
development expenditures of our Component Products segment pursuant to SFAS 2 is
not indicative of the overall effort involved in the development of new products
and features for our Component Products segment. &#160;In response to the
Comment of the Staff in this regard, we will revise our future filings with the
Commission to:</font></div>
      <div>
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            <tr valign="top">
              <td align="right" style="WIDTH: 54pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Discuss
      the research and development and new product development activities of our
      Component Products segment;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 54pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Disclose
      the amount of research and development expenditures for each of the last
      three fiscal years, if such expenditures become material;
    and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 54pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Indicate
      that our Component Products segment spends a significant amount of time
      and effort to refine, improve and adapt its existing products and features
      for new customers and customer applications, and that since expenditures
      for these types of activities are not considered to be research and
      development expense under accounting principles generally accepted in the
      United States of America, the amount of the research and development
      expenditures of our Component Products segment is not indicative of the
      overall effort involved in the development of new products and features
      for our Component Products segment.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Page
2</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 1.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td style="WIDTH: 18pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">With
      regards to your 50% interest in a manufacturing joint venture with a
      subsidiary of Huntsman Corporation, please tell us whether or not any of
      the current business negotiations of Huntsman Corp, specifically the sale
      of Huntsman to Hexion, will impact the joint venture arrangement, the
      parties involved or your interest in the joint
  venture.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We would
expect that Hexion (or one of its subsidiaries) would become the owner of the
other 50% interest in the joint venture in the event Huntsman were to be sold to
Hexion.&#160;&#160;The terms of the joint venture agreement provide for, among
other things, the substitution of an existing joint venture partner for a new
joint venture partner and the continuation of the joint venture under the same
terms and conditions following such substitution.&#160;&#160;Therefore, we do
not believe the substitution of Hexion (or one of its subsidiaries) as the new
owner of the other 50% interest in the joint venture would have any significant
impact to the joint venture arrangement or our interest in the joint
venture.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The joint
venture was formed in 1993.&#160;&#160;Huntsman is the second company to own the
other 50% interest in the joint venture, having acquired such interest from
Tioxide Group, Ltd. (a wholly-owned subsidiary of Imperial Chemicals Industries
PLC and the original owner of the other 50% interest in the joint venture)
around 1999.&#160;&#160;There was no significant impact to the joint venture
arrangement or our interest in the joint venture at the time of the transfer of
the other 50% interest in the joint venture from Tioxide to Huntsman, and we
would similarly expect no significant impact to the joint venture arrangement or
our interest in the joint venture in the event the other 50% interest in the
joint venture were to be transferred from Huntsman to Hexion.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Item 3 &#8211; Legal
Proceedings</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 1.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td style="WIDTH: 18pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">You
      state that plaintiffs in several of the lawsuits you describe are seeking
      compensatory or punitive damages, but in some cases you do not disclose
      the amount claimed.&#160;&#160;Please tell us supplementally with a view
      toward disclosure in future filings whether amounts are specified in these
      suits and if so, why you have not disclosed such amounts.&#160;&#160;We
      may have additional comments upon review of your
  response.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">With
respect to the lead pigment litigation and environmental matters and litigation
discussed in Item 3, we hereby advise the Staff that when the plaintiffs in
these cases are seeking compensatory or punitive damages, the amount of such
damages are generally unspecified.&#160;&#160;In some cases, the damages are
unspecified pursuant to the requirements of applicable state law.&#160;&#160;If
the plaintiffs have specified such damages in their complaint, we have disclosed
the amount of such damages that are being sought (see, for example, the
discussion of <font style="DISPLAY: inline; FONT-STYLE: italic">Smith, et al. v.
Lead Industries Association, et al.</font>, Circuit Court for the Baltimore
City, Maryland, Case No. 24-C-99-004490, in the lead pigment litigation section
of Item 3).&#160;&#160;&#160;With respect to the lead pigment litigation and
environmental matters and litigation discussed in Item 3 for which the
plaintiffs are seeking compensatory or punitive damages that have not been
specified in the applicable complaint, we will revise our future filings with
the Commission to clarify that such damages that are being sought are
unspecified.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
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        </div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
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        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Item 5. Market For
Registrant&#8217;s Common Equity &#8230;..</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 27pt">
                <div><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
      observe from your disclosure in your definitive proxy statement that
      certain of your named executive officers held stock options as of December
      31, 2007.&#160;&#160;Please tell us supplementally why you have not
      included information about securities authorized for issuance under equity
      compensation plans, as required by Item 201(d) of Regulation S-K, in this
      item.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We have
previously omitted the information about securities authorized for issuance
under equity compensation plans pursuant to Item 201(d) of Regulation S-K
because we believe the information is not material.&#160;&#160;In this regard,
we note the following disclosures contained in Note 14 &#8211; Stockholders&#8217; equity to
our Consolidated Financial Statements contained in the Form 10-K regarding
Valhi&#8217;s incentive stock option plan (the only equity compensation plan for which
we would provide information pursuant to Item 201(d)):</font></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
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                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      number of options to purchase Valhi common stock outstanding at December
      31, 2007 (550,000) represents less than 1% of Valhi&#8217;s outstanding common
      stock at that date;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 54pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      aggregate amount payable upon exercise of such options was $5.9 million
      (or a weighted average exercise price of approximately $10.66 per share),
      which represents less than 1% of Valhi&#8217;s consolidated stockholders&#8217; equity
      at December 31, 2007; and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 54pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Approximately
      4.0 million shares were available for grant under Valhi&#8217;s incentive stock
      option plan at December 31, 2007, which represents 3.5% of Valhi&#8217;s
      outstanding common stock at such
date.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">However,
in response to the Comment of the Staff in this regard, in our future filings
with the Commission we will include the information about securities authorized
for issuance under equity compensation plans pursuant to Item 201(d) of
Regulation S-K as part of Item 5.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Item 7. Management&#8217;s
Discussion and Analysis</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Chemical</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 1.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td style="WIDTH: 18pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">You
      disclose that your 2007 chemical segment sales decreased in part due to a
      4% decline in your average selling prices.&#160;&#160;Please revise future
      filings to indicate why prices declined.&#160;&#160;If you believe this is
      a trend that will continue, address how management is going to address
      this negative trend.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 19.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
      noted in our Item 1 discussion of our Chemicals Segment&#8217;s operations in
      the Form 10-K, the majority of our TiO<font style="DISPLAY: inline; FONT-SIZE: 70%; VERTICAL-ALIGN: sub">2</font>
      grades and substantially all of our production are considered commodity
      pigment products. In addition, we compete for sales primarily on the basis
      of price.&#160;&#160;Industry wide prices were in decline in 2007 and the
      first half of 2008, primarily due to competitive market
      pressures.&#160;&#160;As we noted in Management&#8217;s Discussion and Analysis
      in our Quarterly Report of Form 10-Q for the quarters ended June 30, 2008
      and September 30, 2008, we and our competitors have announced various
      price increases and surcharges starting in June 2008 in response to higher
      operating costs, and our average selling prices were higher in the third
      quarter of 2008 as compared to the second quarter of 2008.&#160;&#160;We
      will revise our Management&#8217;s Discussion and Analysis in our future filings
      with the Commission to clarify that our Chemicals Segment pricing
      generally follows industry trends, and that prices increase or decrease
      generally as a result of competitive market pressures.&#160;&#160;In
      addition, to the extent that prices are trending downward and such
      downward trend is expected to continue, we will disclose the actions
      management plans to take to address such downward trend (such as, for
      example, an enhanced focus on cost
control).</font></div>
              </td>
            </tr>
        </table>
      </div>
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        </div>
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4</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
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          </div>
        </div>
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        </div>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 1.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td style="WIDTH: 18pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">6.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">You
      disclose that in your chemicals segment, your cost of sales increased in
      2007 primarily due to the impact of higher sales, values, lower utility
      costs, lower production volumes, and the effect of changes in currency
      exchange rates and higher operating costs.&#160;&#160;Please revise future
      filings to quantify each of these components that impacted your cost of
      sales and indicate the reasons for such
changes.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
generally quantify the impact of certain factors that have an impact on our
Segment&#8217;s operating performance when such quantifications are meaningful and the
impact of those factors is material.&#160;&#160;For example, we include a table
which summarizes the effect of currency exchange rates on our Segment&#8217;s sales
and operating income for the comparative periods.&#160;&#160;We also include a
table which summarizes the effect of changes in selling price, sales volume,
product mix and changes in currency exchange rates on our Chemicals Segment&#8217;s
sales.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">With
respect to the increase in our Chemicals Segment cost of sales in 2007, the
impact of each of the factors indicated was immaterial, but cumulatively led to
the increase in the cost of sales percentage.&#160;&#160;However, in response to
the Comment of the Staff in this regard, we will revise our Management&#8217;s
Discussion and Analysis in our future filings with the Commission to provide a
quantification of the factors that had the most material impact on the change in
our Chemicals Segment cost of sales, and indicate the reasons for those
changes.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Component
Products</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 1.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td style="WIDTH: 18pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">7.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">You
      disclose that net sales in your component product segment decreased in
      2007 primarily due to lower sales of certain products to the office
      furniture market where Asian competitors have established selling prices
      at a level below which you consider would return a minimal
      margin.&#160;&#160;In future filings, expand your discussion to indicate
      how management plans to address this negative
  trend.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
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5</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
believe we adequately disclosed our plans to mitigate the negative effects of
Asian competitors on our Component Products Segment&#8217;s business in the <font style="DISPLAY: inline; FONT-STYLE: italic">Outlook </font>section of the
Component Products Segment discussion within our Management&#8217;s Discussion and
Analysis of the Form 10-K, which reads as follows:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">&#8220;Asian
sourced competitive pricing pressures are expected to continue to be a challenge
for us as Asian manufacturers, particularly those located in China, gain share
in certain markets.&#160;&#160;We believe the impact of this environment will be
mitigated through our on-going initiatives to expand both new products and new
market opportunities.&#160;&#160;Our strategy in responding to the competitive
pricing pressure has included reducing production costs through product
reengineering, improving manufacturing processes through lean manufacturing
techniques and moving production to lower-cost facilities, including our own
Asian-based manufacturing facilities.&#160;&#160;In addition, we continue to
develop sources for lower cost components for certain product lines to
strengthen our ability to meet competitive pricing when practical.&#160;&#160;We
also emphasize and focus on opportunities where we can provide value-added
customer support services that Asian-based manufacturers are generally unable to
provide.&#160;&#160;As a result of pursuing this strategy, we will forego
certain segment sales in favor of developing new products and new market
opportunities where we believe the combination of our cost control initiatives
and value-added approach will produce better results for our
shareholders.&#8221;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For the
information of the Staff, competition from Asian competitors started to have a
much less significant impact on the trend of our Component Product Segment&#8217;s net
sales in the third quarter of 2008.&#160;&#160;As a result, we made no mention
of such Asian competition in our Quarterly Report on Form 10-Q for the quarter
ended September 30, 2008.&#160;&#160;However, the <font style="DISPLAY: inline; FONT-STYLE: italic">Outlook </font>section of the
Component Products Segment discussion of such Form 10-Q continued to indicate
our plans to mitigate the negative effect of the reduced demand that is
affecting our Component Products Segment.&#160;&#160;,</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
response to the Comment of the Staff in this regard, to the extent that reduced
demand from any source continues to negatively impact the trend of our Component
Product Segment&#8217;s net sales, we will revise our Management&#8217;s Discussion and
Analysis in our future filings with the Commission to include a reference to the
<font style="DISPLAY: inline; FONT-STYLE: italic">Outlook</font> section at the
point where the first mention of such reduced demand is made.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 1.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td style="WIDTH: 18pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">8.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">You
      disclose that gross margins increased in your component products segment
      as a result of improved product mix and improvements in your operating
      efficiency through cost reductions.&#160;&#160;Please revise future
      filings to discuss in detail and quantify the changes in the product mix
      and the specific steps you are taking to cut costs.&#160;&#160;To the
      extent you have implemented a cost reduction program that will impact
      future operations, please disclose the terms of this program, any charges
      you will incur to implement the program and any savings you anticipate
      having from this program.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Page
6</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We will
revise our Management&#8217;s Discussion and Analysis in our future fillings with the
Commission to include a quantification of the impact of changes in product mix
on our Component Products Segment gross margin, to the extent such change is
material.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">With
regard to cost reductions, we hereby advise the Staff that we have not
implemented a specific or targeted cost reduction "program" (such as a material
reduction in headcount).&#160;&#160;Rather, the reference to cost reductions
relates to how we manage the Component Products business on an ongoing basis by
constantly striving to reduce or eliminate costs where possible through efforts
such as product reengineering, improving manufacturing processes through lean
manufacturing techniques, moving production to lower-cost facilities and other
similar efforts.&#160;&#160;Progress in these areas varies over time and can be
difficult to measure due to, among other reasons, changes in demand and product
mix.&#160;&#160;Therefore, quantifying the impact of the multiple daily
decisions that impact our cost structure is not practical. In response to the
Comment of the Staff in this regard, we will revise our Management&#8217;s Discussion
and Analysis in our future filings with the Commission to clarify the nature of
the cost reduction efforts of our Component Products Segment and how we measure
improvement in this area.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 19.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td>
                <div align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Critical accounting
      policies and estimates</font></font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 1.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td style="WIDTH: 18pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
      note you tested the long-lived assets in your WCS operations during
      2007.&#160;&#160;With regards to this impairment test, please tell us and
      disclose in future filings, your specific critical accounting estimates
      and assumptions, including how you arrived at the estimate of fair value
      for the WCS reporting unit and whether your assumptions are reasonably
      likely to change in the future.&#160;&#160;You should analyze the specific
      sensitivity of the fair value estimate to change, based on other outcomes
      that are reasonably likely to occur and would have a material effect, as
      well as the amount of headroom between the estimated fair value and
      carrying value for your reporting unit and the possible impact on the
      financial statements.&#160;&#160;You should provide quantitative as well
      as qualitative disclosure when quantitative information is reasonably
      available and will provide material information for
      investors.&#160;&#160;See Section V of SEC Release 33-8350, <font style="DISPLAY: inline; FONT-STYLE: italic">Commission Guidance Regarding
      Management&#8217;s Discussion and Analysis of Financial Condition and Results of
      Operations </font>for additional information and revise to include
      appropriate disclosure relating to your critical accounting estimates and
      assumptions.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
discussed in Item<font style="DISPLAY: inline; FONT-STYLE: italic">&#160;</font>1<font style="DISPLAY: inline; FONT-STYLE: italic">, </font>our Waste Management
Segment currently operates its waste disposal facility on a relatively limited
basis while obtaining regulatory approval for certain disposal
licenses.&#160;&#160;Consistent with the requirements of SFAS 144, our
impairment analysis first compares our estimated aggregate undiscounted cash
flows projections for WCS against the carrying value of WCS&#8217; net
assets.&#160;&#160;To the extent these estimated aggregate undiscounted cash
flows exceed the carrying value of WCS&#8217; net assets, the carrying amount of such
net assets are deemed to be recoverable and no impairment is
recognized.&#160;&#160;With respect to our impairment test for WCS during 2007,
we concluded the WCS&#8217; net assets were recoverable.&#160;&#160;As a result, we
were not required to determine the fair value of WCS&#8217; net assets pursuant to the
requirements of paragraph 7 of SFAS 144.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Page
7</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
undiscounted cash flows analysis includes a number of significant assumptions,
including (i) the timing for when WCS will obtain the additional disposal
licenses it is seeking, (ii) the amount of time and capital it will take WCS to
complete construction of expanded disposal facilities after it receives the
additional licenses it is seeking and (iii) the estimated amount and timing of
revenues and operating profit that WCS would earn following receipt of the
additional licenses it is seeking.&#160;&#160;These cash flow estimates are
updated as new information and expectations regarding the status of regulatory
approval are obtained.&#160;&#160;While WCS has been seeking regulatory approval
for its services for a number of years, steady progress towards this goal has
been made. In this regard, as noted in our Quarterly Report on Form 10-Q for the
quarter ended September 30, 2008, WCS has received the byproduct disposal
license it was seeking, and WCS is currently awaiting approval for a final
low-level and mixed low-level radioactive waste disposal license.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
comparing our estimated aggregate undiscounted cash flows projections for WCS
against the carrying value of WCS&#8217; net assets, we also consider the extent by
which the estimated aggregate future undiscounted cash flow amounts for WCS
exceeds the carrying value of WCS&#8217; net assets as part of a sensitivity
analysis.&#160;&#160;For example, with respect to our impairment test for WCS
during 2007, the estimated aggregate undiscounted cash flows projections for WCS
was an amount that was at least two times the carrying value of WCS&#8217; net
assets.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We have
disclosed the importance of obtaining regulatory approval for these new licenses
in Item 1, which reads as follows:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt">&#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic">It is possible our
ability to obtain and retain permits on a timely basis could be impaired in the
future.&#160;&#160;The loss of an individual permit or the failure to obtain a
permit could have a significant impact on our Waste Management Segment&#8217;s future
operating plans, financial condition, results of operations or liquidity,
especially because we only own and operate one disposal site.&#160;&#160;For
example, adverse decisions by governmental authorities on our permit
applications could cause us to abandon projects, prematurely close our facility
or restrict operations.&#8221;</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
response to the Comment of the Staff in this regard, in our future filings with
the Commission we will expand our disclosures within our Critical Accounting
Policies and Estimates section regarding long-lived asset impairment for WCS as
follows:</font></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Indicate
      that our estimated future undiscounted cash flow estimates for WCS include
      significant assumptions regarding (i) the timing for when WCS will obtain
      the additional disposal licenses it is seeking, (ii) the amount of time
      and capital it will take WCS to complete construction of expanded disposal
      facilities after it receives the additional licenses it is seeking and
      (iii) the estimated amount and timing of revenues and operating profit
      that WCS would earn following receipt of the additional licenses it is
      seeking;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Indicate
      if applicable that the carrying amount of WCS&#8217; net assets were deemed to
      be recoverable as a result of such estimated aggregate future undiscounted
      cash flow amounts being an amount in excess of the carrying value of WCS&#8217;
      net assets;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Page
8</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
        </div>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Indicate
      the magnitude by which the estimated aggregate future undiscounted cash
      flow amounts for WCS exceeds the carrying value of WCS&#8217; net assets;
      and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Clarify
      that different assumptions, including a failure to obtain approval for the
      low-level disposal license that WCS is seeking or a significant delay in
      obtaining such license, could result in materially different cash flow
      estimates and cause the recognition of a material long-lived asset
      impairment.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Please
      tell us whether or not your other reporting units were tested for
      impairment and if so, please disclose the results of those tests,
      including the amount of headroom between the carrying value of the assets
      and their recoverable amount.&#160;&#160;If not, please tell us your
      consideration of paragraph 8 of SFAS 144 as it relates to these
      assets.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As noted
in the long-lived asset discussion of our Critical Accounting Policies and
Estimates section of the Form 10-K, we assess long-lived assets for impairment
only when circumstances indicate an impairment may
exist.&#160;&#160;&#160;During 2007, there were no circumstances which indicated
a possible impairment at any of our other reporting units.&#160;&#160;In
considering the circumstances under which an impairment might exist, we consider
the circumstances indicated by paragraph 8 of SFAS 144, which can be summarized
as follows:</font></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A
      significant decrease in the market price for a long-lived asset
      group;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A
      significant adverse change in the extent or manner in which a long-lived
      asset group is used or its physical
condition;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A
      significant adverse change in the legal factors or business climate that
      could affect the value of a long-lived asset
  group;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">An
      accumulation of costs significantly in excess of the amount originally
      expected for the acquisition or construction of a long-lived asset group;
      or</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A
      current-period operating or cash flow loss combined with a history of
      operating or cash flow losses for a long-lived asset
  group.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
than with respect to WCS, none of the circumstances indicated above are present
with any of our reporting units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
response to the Comment of the Staff in this regard, in our future filings with
the Commission we will include a statement indicating that reporting units not
specifically mentioned in the long-lived asset discussion of our Critical
Accounting Policies and Estimates section were not tested for impairment because
no impairment indicators were present for those other long-lived asset
groups.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      future filings, please expand your discussion of critical accounting
      policies, specifically goodwill and retirement benefits to address the
      existence of material estimates or assumptions, how these matters may
      affect the financial statements and the likelihood that materially
      different amounts would be reported under different conditions or using
      different assumptions.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">With
      regards to your retirement benefits policy, please ensure that your policy
      discussion includes a sensitivity analysis of the effect of changes in
      your material assumptions, such as your discount rates, future
      compensation levels, expected return on plan assets, and mortality
      rates.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Page
9</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
        </div>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">With
      regards to your goodwill policy, please ensure your policy includes
      discussion on how you determined your reporting units and your basis for
      determining the units under paragraphs 30 &#8211; 36 of SFAS
      142.&#160;&#160;Further address why certain reporting units were valued
      using level 1 inputs when others were valued using level
  3.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Refer
to the Commission&#8217;s guidance concerning critical accounting estimates, available
on the SEC website at www.sec.gov./rules/interp/33-8350.htm.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">With
respect to our retirement benefit plans, we believe we have adequately disclosed
our material assumptions, and estimates and how changes to these assumptions or
estimates might affect our financial statements, in the &#8220;<font style="DISPLAY: inline; FONT-STYLE: italic">Assumptions on defined benefit
pension and OPEB plans</font>&#8221; section of our Management&#8217;s Discussion and
Analysis. This section includes, among other things, a sensitivity analysis of
the effect of changes in our material assumptions (i.e. discount rate and rate
of return on plan assets) on the amount of our benefit obligations and benefit
expense.&#160;&#160;We include a reference to this section in our Critical
Accounting Policies and Estimates discussion.&#160;&#160;Due to the length and
detail of the discussion we believe it is appropriate to discuss these items in
a separate section.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We also
indicate in the Critical Accounting Policies and Estimates discussion that
different retirement benefit plan assumptions could result in the recognition of
different expense amounts over different periods of time.&#160;&#160;In response
to the Comment of the Staff in this regard, in our future filings with the
Commission we will clarify that different retirement benefit plan assumptions
could result in the recognition of materially different expense, asset and
liability amounts in our Consolidated Financial Statements.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">With
respect to goodwill, we will expand our Critical Accounting Policies and
Estimates Section in our future filings with the Commission to include a
discussion of (i) how we determine our goodwill reporting units pursuant to the
guidance of SFAS 142 and (ii) why certain goodwill reporting units (i.e. our
single Chemicals reporting unit represented by our investment in Kronos
Worldwide, Inc.) is evaluated for goodwill impairment using a Level 1 input
under FAS 157 (i.e. because a quoted market price for Kronos&#8217; common stock is
available), while our other goodwill reporting units (i.e. our three Component
Products reporting units) are evaluated for goodwill impairment using Level 3
inputs under FAS 157 (i.e. discounted cash flow estimates) because Level 1
inputs (i.e. quoted market prices) are not available for the three reporting
units within our Component Products segment.&#160;&#160;In addition, to the
extent that we use Level 3 inputs under FAS 157 for our goodwill impairment
analysis, we will also clarify in our future filings with the Commission that
different cash flow assumptions and estimates could result in the recognition of
a material goodwill impairment.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
        </div>
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10</font></div>
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          </div>
        </div>
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        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Liquidity</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">12.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
      note that a portion of your cash provided by operating activities was
      provided by your parent.&#160;&#160;Please tell us whether or not sales
      are made to or from Contran.&#160;&#160;To the extent you have related
      party transactions with your parent, please revise the financial
      statements, in future filings, to separately identify related party
      transactions on the face of each statement, including revenue, expenses,
      and amounts receivable and payable to marketing companies that meet the
      definition of a related party.&#160;&#160;Otherwise, clarify how your
      parent provides you operating cash flows.&#160;&#160;Refer to Rule 1-02(b)
      of Registration S-X and SFAS 57.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Staff&#8217;s Comment probably arose from the reference to &#8220;Valhi Parent&#8221; contained in
the table in Liquidity and Capital Resources in the Form 10-K, which details
cash provided by or used in operating activities by entity.&#160;&#160;Valhi
Parent, as used in this table, represents a reference to Valhi exclusive of the
other indicated Valhi subsidiaries, and not a reference to our parent company,
Contran Corporation (i.e. it represents Valhi, as the parent entity of the other
indicated Valhi subsidiaries).&#160;&#160;In our future filings with the
Commission, we will clarify that the reference to &#8220;Valhi Parent&#8221; means Valhi
exclusive of the other indicated Valhi subsidiaries.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Please
note that all of our related party transactions, including those with Contran,
are properly disclosed in Note 16 &#8211; Related party transactions to our
Consolidated Financial Statements contained in the Form 10-K, and amounts
payable to and receivable from all affiliates, including Contran, are separately
identified on the face of our Consolidated Balance Sheet.&#160;&#160;&#160;We
hereby advise the Staff that we have no sales to or purchases from Contran or
any of our other affiliates, except for purchases in the ordinary course of
business from our Chemicals Segment joint venture (Louisiana Pigment Company)
disclosed in Note 16.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 19.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td>
                <div align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Item 7A. Quantitative
      and Qualitative Disclosures about Market
  Risk</font></font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">13.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Considering
      your existing disclosures regarding the increased raw material costs in
      2007 and the significant impact the raw materials costs had on your
      operations, a discussion of commodity price risk management strategies
      appears appropriate.&#160;&#160;Please revise your MD&amp;A, in future
      filings, pursuant to Item 305(b) of Regulation S-K, to discuss your
      commodity price exposure, your risk management strategies, or if you don&#8217;t
      manage this risk, a statement disclosing that
  fact.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As noted
in our Item 1 discussion of raw materials, we generally enter into long-term
supply agreements for certain of our raw material requirements for our Chemicals
Segment, and our Component Products segment will occasionally enter into raw
material arrangements to mitigate the short-term impact of future increases in
raw material costs.&#160;&#160;Otherwise, we generally do not have long-term
supply agreements for our raw material requirements either because we have
assessed the risk of the unavailability of those raw materials and/or the risk
of a significant change in the cost of those raw materials to be low, or because
long-term supply agreements for those raw materials are generally not available.
In our future filings with the Commission, as part of Item 7A we
will:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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11</font></div>
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      </div>
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                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Include
      a discussion of our commodity price
exposures;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
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                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Indicate
      the steps we take to mitigate certain of such exposures (i.e. through the
      indicated long-term supply agreements);
and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Indicate
      the reasons why we do not enter into long-term supply agreement for our
      other raw material requirements (i.e. because we have either assessed the
      risk of the unavailability of those raw materials and/or the risk of a
      significant change in the cost of those raw materials to be low, or
      because long-term supply agreements for those raw materials are generally
      not available).</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 19.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td>
                <div align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Note 21. Quarterly
      results of operations</font></font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">14.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
      note that during the three month period ending June 30, 2007, net income
      decreased to a net loss of $4.9 million and continued to decrease in the
      third quarter ending September 30, 2007, to $52.7
      million.&#160;&#160;Please tell us and disclose the reasons for this
      decrease in net income during the second and third
      quarters.&#160;&#160;Note that the effect of any significant changes,
      events and/or circumstances on your quarterly data should be discussed in
      accordance with Item 302 of Regulation
S-K.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
disclosed in Note 3 &#8211; Business combinations and related transactions to our
Consolidated Financial Statements contained in the Form 10-K, we ceased to
account for our ownership interest in Titanium Metals Corporation by the equity
method effective April 1, 2007.&#160;&#160;This was the primary reason for the
decrease in our net income in the second quarter of 2007.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
disclosed in Note 12 &#8211; Income taxes to our Consolidated Financial Statements
contained in the Form 10-K, we recognized an $87.4 million income tax charge in
the third quarter of 2007 related to the change in German income tax
rates.&#160;&#160;This was the primary reason for the decrease in our net income
in the third quarter of 2007.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
response to the Comment of the Staff in this regard, in our future filings with
the Commission we will include explanatory footnotes to the 2007 unaudited
quarterly data to indicate these reason for the decreases in our net income in
the second and third quarters of 2007.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 19.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td>
                <div align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Definitive Proxy
      Statement on Schedule 14A</font></font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 19.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td>
                <div align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Compensation of
      Executive Officers and Directors and Other
    Information</font></font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 19.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td>
                <div align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Compensation
      Discussion and Analysis</font></font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 19.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td>
                <div align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Intercorporate
      Services Agreements</font></font></div>
              </td>
            </tr>
        </table>
      </div>
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        </div>
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          <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
        </div>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">15.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
      note that you share the expense of your executive officers&#8217; services,
      among other costs, with related entities based on your intercorporate
      services agreements with Contran Corporation and that your respective
      share of these costs are considered and approved by your board of
      directors.&#160;&#160;Please tell us supplementally, with a view toward
      disclosure in future filings, the extent to which Valhi&#8217;s management
      development and compensation committee is informed of, considers or
      provides feedback to Contran regarding executive performance and the
      CD&amp;A items (such as, for example, what Valhi believes compensation
      should be designed to reward) described in Item 402(b) of Regulation S-K
      in recommending to approve the proposed ISA fee.&#160;&#160;For example,
      does the Valhi committee know about and consider Contran&#8217;s compensation
      policies to ensure that they are consistent with Valhi&#8217;s objectives and
      requirements for effective management of the company? Further, if Valhi
      has objectives and requirements for effective management of the company
      that are linked to or rewarded by compensation, what are those objectives
      and requirements and how does Valhi believe they are met?&#160;&#160;Does
      Valhi provide Contran with any type of feedback on executive performance
      in order for Contran to set various elements of
    compensation?</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As noted
in the Compensation, Discussion and Analysis section of the Definitive Proxy
Statement (&#8220;CD&amp;A&#8221;), each of our named executive officers for 2006 and 2007
were employees of Contran Corporation.&#160;&#160;Our named executive officers
provide their services to us pursuant to the terms of certain intercorporate
services agreements (&#8220;ISAs&#8221;), which are also discussed in the
CD&amp;A.&#160;&#160;We pay a fee to Contran under these ISAs to receive, among
other things, the services of our named executive officers.&#160;&#160;The fee
we pay to Contran reimburses Contran for its cost of employing all of the
personnel, including our named executive officers who provide services to us, by
allocating such costs based on the estimated time such personnel are expected to
devote to us over the year.&#160;&#160;The amount of the fee we pay Contran
under these ISAs is not dependent upon our financial
performance.&#160;&#160;Even though we do not directly compensate each of our
named executive officers, we consider the portion of the aggregate fee we pay to
Contran for each person who provides services to us under the ISAs, including
our named executive officers, to be the reasonable equivalent of &#8220;compensation&#8221;
for purposes of providing disclosures pursuant to Item 402 of Regulation
S-K.&#160;&#160;Therefore, our compensation policy provides that our management
development and compensation (&#8220;MD&amp;C&#8221;) committee annually evaluate
whether:</font></div>
      <div>
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            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      cost to Valhi to directly employ the personnel necessary to provide the
      quality of services provided to us by Contran personnel would exceed the
      proposed aggregate fee to be charged to us by Contran under the applicable
      ISA; and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      cost for such services would be no less favorable than could otherwise be
      obtained from an unrelated third party for comparable
      services.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Through
their membership on the MD&amp;C committee as well as the board of directors,
the members of our MD&amp;C committee work directly with our executive
officers.&#160;&#160;Accordingly, the members of the MD&amp;C committee have
direct knowledge of the quality of the services that our named executive
officers provide to us each year.&#160;&#160;As noted in the CD&amp;A, our
MD&amp;C committee considers, among other things, the quality of the services
that the employees of Contran provide to us each year, including the quality of
the services of our named executive officers, for purposes of determining
whether to recommend that the proposed ISA fee for each year be approved by the
full board of directors.&#160;&#160;The MD&amp;C committee is not required to
provide any feedback to the executive officers of Contran regarding the quality
of the services that our named executive officers provide to us each year
because our named executive officers also serve as the executive officers of
Contran (as disclosed in the Executive Officer section of the Definitive Proxy
Statement).&#160;&#160;However, as part of the MD&amp;C committee&#8217;s evaluation
of whether to recommend that the proposed ISA fee for each year be approved by
the full board of directors, the members of the MD&amp;C committee have the
opportunity to consider the quality of the services provided to us by Contran,
including the quality of the services provided to us by our executive
officers.</font></div>
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        </div>
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        </div>
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        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As noted
in the CD&amp;A, our MD&amp;C committee also considers the ISA charge and the
number of full-time equivalent employees reflected in that charge, by
department, for the prior year and the proposed current year, as well as the
comparison of the prior year and proposed current year aggregate average hourly
rate, for purposes of determining whether to recommend that the proposed ISA fee
for each year be approved by the full board of directors.&#160;&#160;In
addition, the MD&amp;C committee also considers the cost we would incur to
directly employ the personnel necessary to provide a similar quality of the
services provided to us by Contran under the ISAs in comparison to the aggregate
fee we pay Contran under the ISAs.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As noted
in the Executive Officer section of the Definitive Proxy Statement, each of our
named executive officers provides services to many companies related to Contran,
including Contran itself.&#160;&#160;Consequently, the fee we pay to Contran
under the ISAs does not represent all of Contran&#8217;s cost of employing each of our
named executive officers.&#160;&#160;Therefore, Contran and these other
companies related to Contran absorb the remaining amount of Contran&#8217;s cost of
employing each of our named executive officers.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Given
that (i) each of our named executive officers are employed and compensated by
Contran, (ii) each of our named executive officers provide services to Contran
and other companies related to Contran, other than us, and therefore the fee we
pay to Contran under the ISAs does not represent all of Contran&#8217;s cost of
employing each of our named executive officers and (iii) the amount of the fee
we pay Contran under the ISAs is not dependent upon our financial performance,
the MD&amp;C committee is not required to gain an understanding or have
knowledge of the compensation policies of Contran because it is not relevant to
their decision-making process. What is relevant to the decision-making process
of our MD&amp;C committee is, among other things, the committee&#8217;s conclusion
that the cost to directly employ the sufficient number and skill levels of
personnel necessary to provide the commensurate level and quality of services
provided by Contran would exceed the proposed fee to be paid to Contran under
the ISAs.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As noted
in instruction number 1 to Item 402(b) of Regulation S-K, the purpose of the
CD&amp;A is to provide investors with material information that is necessary to
understand the registrant&#8217;s compensation policies and decisions regarding the
named executive officers.&#160;&#160;For the reasons noted above, our CD&amp;A
disclosure provides investors with material information necessary to understand
the process by which our MD&amp;C committee determines whether to recommend that
the proposed ISA fee for each year be approved by the full board of
directors.&#160;&#160;In response to the Comment of the Staff in this regard, we
will clarify the following items in the CD&amp;A section of our future filings
with the Commission:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Page
14</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
        </div>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
      employees of Contran, each of our named executive officers are compensated
      directly by Contran;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Each
      of our named executive officers serve as executive officers of
      Contran;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
      part of the MD&amp;C committee&#8217;s evaluation of whether to recommend that
      the proposed ISA fee for each year be approved by the full board of
      directors, the members of the MD&amp;C committee consider the level and
      quality of the services that our executive officers provide to us;
      and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Having
      an understanding or have knowledge of the compensation policies of Contran
      is irrelevant to the MD&amp;C committee&#8217;s determinations
      because:</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 99pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">o&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Each
      of our named executive officers provides services to many companies
      related to Contran, including Contran
itself;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 99pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">o&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      fee we pay to Contran under the ISAs each year does not represent all of
      Contran&#8217;s cost of employing each of our named executive
      officers;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 99pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">o&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Contran
      and these other companies related to Contran absorb the remaining amount
      of Contran&#8217;s cost of employing each of our named executive officers;
      and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 99pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">o&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      members of the MD&amp;C committee consider the other factors discussed
      above in determining whether to recommend that the proposed ISA fee for
      each year be approved by the full board of
  directors.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 19.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td>
                <div align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Summary of Cash and
      Certain Other Compensation of Executive
  Officers</font></font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 19.25pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
      </font></div>
              </td>
              <td>
                <div align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">2007 Summary
      Compensation Table</font></font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">16.</font></div>
              </td>
              <td>
                <div align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
      understand that the cost of your executive officers&#8217; services, which
      comprises part of the fee you pay Contran, includes a bonus
      amount.&#160;&#160;In future filings, please include a &#8220;bonus&#8221; column and
      related disclosure in your summary compensation table.&#160;&#160;See
      Items 402(c)(1) and (c)(2)(iv).</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As noted
above in our response to Comment No. 15 as well as disclosed in the CD&amp;A, we
pay a fee to Contran under these ISAs to receive, among other things, the
services of our named executive officers.&#160;&#160;The fee we pay to Contran
reimburses Contran for its cost of employing all of the personnel, including our
named executive officers, who provide services to us by allocating such costs
based on the estimated time such personnel were expected to devote to us over
the year.&#160;&#160;The amount of the fee we pay Contran under these ISAs is
not dependent upon our financial performance.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As noted
in the CD&amp;A, Contran&#8217;s cost of employing the personnel who provide services
to us is the sum of:</font></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Such
      person&#8217;s annualized base salary at the beginning of each
    year;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      bonus paid by Contran to such person in the prior year, other than any
      bonus paid for a specific matter unrelated to us (which serves as a
      reasonable approximation of the bonus that may be paid in the current
      year); and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 63pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">An
      overhead factor (as described).</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Page
15</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
MD&amp;C committee does not individually consider these three elements of
Contran&#8217;s cost for purposes of determining whether to recommend that the
proposed ISA fee for each year be approved by the full board of directors.
Rather, the MD&amp;C committee considers these three elements of Contran&#8217;s cost
in the aggregate in determining whether to recommend that the proposed ISA fee
for each year be approved by the full board of directors.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As noted
above in our response to Comment No. 15, even though we do not directly
compensate each of our named executive officers, we consider the portion of the
aggregate fee we pay to Contran for each person who provides services to us
under the ISAs, including our named executive officers, to be the reasonable
equivalent of compensation.&#160;&#160;&#160;Because the MD&amp;C committee
considers the three elements of Contran&#8217;s cost of employing the individuals who
provide services to us under the ISAs in the aggregate, and not individually,
and because the amount of the fee we pay Contran is not dependent upon our
financial performance, we do not believe it would be appropriate to segregate
the portion of the aggregate fee we pay to Contran for each of our named
executive officers who provides services to us under the ISAs amongst these
three elements of Contran&#8217;s cost for purposes of the Summary Compensation Table
pursuant to Item 402(c) of Regulation S-K.&#160;&#160;In response to the Comment
of the Staff in this regard, we will clarify in our future filings with the
Commission that the MD&amp;C committee considers the three elements of Contran&#8217;s
cost of employing the personnel who provide services to us under the ISAs in the
aggregate, and not individually, in determining whether to recommend that the
proposed ISA fee for each year be approved by the full board of
directors.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 19.25pt"></font>Valhi acknowledges
that:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Valhi
      is responsible for the adequacy and accuracy of the disclosure in our
      filings with the Commission;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Staff
      comments or changes to disclosure in response to Staff comments do not
      foreclose the Commission from taking any action with respect to our
      filings with the Commission; and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Valhi
      may not assert Staff comments as a defense in any proceeding initiated by
      the Commission or any other person under the federal securities laws of
      the United States.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Page
16</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If you
have any questions regarding our responses to the Comment Letter, please feel
free to call me at (972) 450-4228.&#160;&#160;I can also be reached via
facsimile at (972) 448-1445 or via email at <font style="DISPLAY: inline; TEXT-DECORATION: underline">gswalwell@valhi.net</font>.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Sincerely,</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Valhi,
Inc.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">By: <font style="DISPLAY: inline; TEXT-DECORATION: underline">_/s/ Gregory M.
Swalwell&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font>Gregory M. Swalwell,</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>Vice President and
Controller</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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