Tronox plans to refinance part of capital structure by mid-October

New York, Aug. 3 – Tronox Ltd. plans to refinance a portion of its capital structure in order to cut borrowing costs and extend its average maturity, according to a news release.

The company also plans to “improve its mix of secured and unsecured debt and achieve more favorable covenants.”

Further, the new debt is expected to give the company more flexibility to pay down its borrowings.

The combination of the TiO2 businesses of Tronox and that of National Titanium Dioxide Co. and Cristal Inorganic Chemicals Netherlands Coöperatief WA is expected to generate “substantial additional free cash flow,” the company said.

At closing leverage is expected to be 4.5 times as measured by net debt to trailing 12-month pro forma EBITDA before synergies.

Additional decreases in net leverage are expected after closing.

Tronox aims to complete the refinancing by mid-October.

The company also announced that it has agreed to sell its alkali chemicals business to Genesis Energy, LP for $1,325,000,000 in cash.

Proceeds will be used to fund most of the cost of the Cristal acquisition, Tronox said.

Credit Suisse is financial adviser to Tronox in the Cristal acquisition and the alkali chemicals sale.

Tronox is a Stamford, Conn., mining and inorganic chemical company operating in two segments, mining and processing of titanium ore, zircon and other minerals, and manufacture of titanium dioxide pigments and, secondly, mining of trona ore and manufacture of natural soda ash, sodium bicarbonate, caustic soda and other compounds.

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