Lenders grant Tronox Q2 credit waiver

21 July 2008 23:28  [Source: ICIS news]

HOUSTON (ICIS news)--Tronox's creditors have granted the US pigment maker a credit waiver from its largest lender for the second quarter, the company said on Monday.

Tronox, beset by elevated energy, freight and raw materials costs and its inability to raise TiO2 prices, requested the amendment to its financial covenants under a senior secured credit facility.

The Oklahoma City, Oklahoma-based company also has requested a similar waiver for the remainder of the year.

The amendment was sought partly as a result of unexpected second-quarter costs stemming from production difficulties at its TiO2 facilities in Uerdingen, Germany, and Kwinana, Western Australia, and higher natural gas costs due to the shutdown of Apache Energy’s Varanus Island natural-gas processing plant there, according to documents filed with the US Securities & Exchange Commission (SEC).

The waiver is the latest effort by the world's third-largest producer of TiO2 to reduce costs and abate the decline of its stock value.

The company's per-share price was $1.73 at the close of trading on Monday on the New York Stock Exchange. On 19 June, it traded at $4.11.

In recent months, Tronox has implemented a hiring freeze, announced staff cuts and suspended matching 401K contributions and quarterly dividends ...

Other US TiO2 producers include Cristal, DuPont, Huntsman and Kronos.

For more on TiO2, visit ICIS chemical intelligence
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By: Larry Terry
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