Kerr-McGee Corp.’s board of directors has approved the separation of its chemical business through an initial public offering (IPO) of shares of the Class A common stock of its wholly-owned subsidiary, Tronox Incorporated. The IPO is planned for the fourth quarter of 2005.
Following the IPO, Kerr-McGee will continue to hold an interest in Tronox through ownership of Tronox’s Class B common stock. Kerr-McGee expects to distribute those shares to its stockholders through a spin off or split off during 2006.
Headquartered in Oklahoma City, chemical business is the world’s third-largest producer and marketer of titanium dioxide pigment, with a 13% global market share and annual production capacity of 624,000 tonnes The business has five pigment plants, in United States, Australia, Germany and The Netherlands.
“We believe the total value received through creating a separate public company to be superior to a sale of the chemical business,” said Luke R. Corbett, Kerr-McGee chairman and CEO. “The expertise, quality products and technological and cost advantages of our chemical business, combined with current market conditions, will allow us to create a strong stand-alone company that will unlock the value of the chemical business.”