21 January 2000 22:35 [Source: ICIS news]
HOUSTON (CNI)--Kerr-McGee said Friday it will pay down debt with an offering of 9m shares of common stock and $300m (Euro297m) worth of ten-year convertible subordinated debentures.
But a recent analysts report indicates Kerr also may be stockpiling funds for further expansions in its chemical business, too.
The Oklahoma City, Oklahoma oil company is a major participant in the global titanium dioxide (TiO2) business with 20% of its assets in its chemicals business.
Kerr said it will use net proceeds from both offerings to repay existing debt, including those associated with its $555m (Euro549m) acquisition of Repsol's oil and gas properties in the North Sea.
The company's stock price closed Friday at $63.94/share, just below its 52-week high of $67.75 and well above the low of $28.50.
In a recent report on Kerr-McGee, analysts at Salomon SmithBarney said it has become a major independent oil company and predicted its TiO2 profits will increase due to cost cuts and capacity expansions.
Salomon expects Kerr's chemicals segment to increase earnings to $144m this year compared with $115m in 1998.
They also predicted recently that Kerr ranks as a likely bidder for Finland's Kemira, the world's sixth largest producer of TiO2 and set its value at about $500m.
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