Titanium dioxide supplier Venator enters Chapter 11
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Titanium dioxide supplier Venator enters Chapter 11

Jan 12, 2024

Venator Materials plc, a major supplier of plastics whitener titanium dioxide, is entering a planned Chapter 11 bankruptcy process to reduce debt and allow future growth.

In a news release, officials with Venator in Wynyard, England, said that the bankruptcy will "equitize nearly all of the firm's funded debt, strengthen its balance sheet and facilitate an infusion of new capital." Venator's supporting creditors are providing $275 million in funding for the recapitalization.

The company filed the Chapter 11 petition with the U.S. Bankruptcy Court for the Southern District of Texas on May 14.

"Following approval by the court, the DIP [debtor-in-possession] financing, together with cash on hand and cash generated from ongoing operations, is expected to provide substantial liquidity to support Venator throughout the recapitalization process and beyond," officials said. Venator's businesses are expected to continue to operate as normal. The firm also expects to continue to pay wages and benefits to its employees and to pay all trade partners.

The agreement "will place the company on sound financial footing, which will enable us to deliver on our strategy and capitalize on future growth opportunities," President and CEO Simon Turner said. He added that Venator "has faced unprecedented economic headwinds, including significantly lower product demand and higher raw material and energy costs in the second half of 2022."

Venator posted sales of just under $2.2 billion in 2022, roughly flat vs. 2021. The firm posted a 2022 loss of $181 million after losing $74 million 2021 and $105 million in 2020. Venator was formed in 2017 as a spinoff of the TiO2 and performance additives business of Huntsman Corp. The firm employs almost 2,800 worldwide.

Globally, Venator operates 20 plants making TiO2 and other performance additives. The firm operates seven global TiO2 plants: five in Europe, one in Malaysia and one in Lake Charles, La. In North America, Venator also operates color pigments plants in Los Angeles and in Freeport, Texas.

Venator expects to be delisted by the New York Stock Exchange in accordance with its rules. Venator common shares will continue to trade over-the-counter throughout the duration of the Chapter 11 process. The shares are proposed to be canceled as part of Venator's restructuring.

On Wall Street, Venator's per-share stock price began the year at 62 cents, but was near 27 cents in early trading May 17.

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