Tronox Incorporated, one of the world's largest manufacturers of titanium dioxide (TiO2) recently announced that it and few subsidiaries have filed voluntary petitions for reorganization under Chapter 11 of the US Bankruptcy Code due to severely difficult market conditions in the North American region. The filing does not include Tronox's operations outside of the US, which are based in Australia, Germany and the Netherlands. As per a company statement, it has taken steps to ensure the continued supply of goods and services to its customers, with a commitment for up to US$125 mln in new debtor-in-possession (DIP) financing from its existing lending group led by Credit Suisse.
"After careful evaluation of all strategic alternatives, we have concluded that a Chapter 11 filing is the best way to address the company's debt, in particular its legacy liabilities," said Dennis Wanlass, Tronox chairman and chief executive officer. The DIP financing provides Tronox with ample liquidity to continue operations as usual during the restructuring process. The company will use the financing to pay vendors for all goods and services provided after the filing date. Additionally, Tronox has requested court approval to continue to pay employees in the same manner as before the filing with no disruption, and expects the request to be granted as part of the court's "first day" orders.