Pigment Maker Tronox Files For Bankruptcy

Tronox, a manufacturer of the white pigment titanium dioxide, has filed for reorganization under Chapter 11. The bankruptcy does not include the company's non-U.S. operations. Tronox says it decided to reorganize to better handle legacy environmental liabilities dating from its spin-off from energy company Kerr-McGee in 2006. Tronox' financial results show that environmental legacy costs are not its only difficulty. For the third quarter of 2008, Tronox reported a net loss of $37.9 million. At the time, the firm also said it would likely spend between $30 million and $35 million of a $183.8 million reserve fund for environmental remediation during 2008. Earlier in 2008, Tronox announced cost-cutting moves including land sales and layoffs in response to higher costs and production problems in Australia and Germany. While in reorganization, Tronox says it will have access to $125 million in debtor-in-possession financing from its lenders, led by Credit Suisse.