Tronox Inc. (TROX)

[newtechinvestor]

Per SEC filing (10q) as of September 30, 2008 the outstanding 9.5% Senior Unsecured Notes due December 2012 was $350mil.

So, under the Current Bondholders' Plan, they are proposing putting in additional $105mil (from bond investors) to increase their total investment to $405mil. For that amount they are carving out 70% of reorganized Tronox which is conservatively worth minimum $800mil to more than $1bil once the company is out of bk lean and clean with no enviromental liabilies. Seventy percent of $800 is $560mil and of $1bil is $700mil.

Under normal financing conditions, Tronox should be able to arrange a loan to pay off bondholders full $350 and they would be shut of reorganized Tronox. But the current capital market is still tight so obtaining all the funds necessary to fund pre and post-petition loan, bondholders and the litigation trust would be difficult.

So, I expect EC to advance a plan to counter the bondholders plan that has a significant stake for equity holders.