Tronox files reorganization plan
Jul 09, 2010 (The Oklahoman - McClatchy-Tribune Information Services via COMTEX) --
Copyright (C) 2010, The Oklahoman, Oklahoma City
Tronox Inc., a bankrupt Oklahoma City chemical company, has filed a reorganization plan designed to allow the company to emerge "as a going concern," CEO Dennis Wanlass said Thursday.
The plan proposes the establishment of government trusts to settle the company's environmental remediation responsibilities. The trusts would be funded with up to $145 million, plus 88 percent of Tronox's interest in a 2009 lawsuit filed against Kerr-McGee and Anadarko Petroleum, which bought Kerr-McGee in 2006.
Tronox, which was spun off from Oklahoma City-based Kerr-McGee in 2006, claimed in its lawsuit that its former parent loaded up Tronox with environmental liabilities to make itself more attractive. The bankruptcy plan would strip the company of those environmental liabilities.
Under the reorganization plan, Tronox's general unsecured creditors are expected to recover between 80 percent and 100 percent of their claims by inheriting all of the primary common equity in the reorganized company.
Common shareholders who vote in favor of the plan will receive warrants to purchase up to 5 percent of the reorganized company's equity.
"Importantly, the plan would enable Tronox to emerge from Chapter 11 as a going concern, responsibly capitalized and well positioned to ensure its long-term viability for the benefit of all stakeholders," Wanlass said.
Tronox, which makes and sells a whitening pigment used in paint, plastics and a variety of common products, employs about 920 people, including about 130 in Oklahoma City, spokesman Robert Gibney said.
The reorganized company would retain responsibility for the pension of Tronox employees and retirees, Gibney said.
The plan remains subject to approval by the federal bankruptcy court in Delaware. Gibney said the company probably would emerge sometime this fall.
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