The Woodlands, Texas – Huntsman will use the proceeds of a recent sale of shares in its Venator titanium dioxide business to pay off the last of its senior secured loans.
The debt to be paid is the company’s Term Loan B due in 2023, and will be settled by the $471m generated by the sale of Venator and cash on hand for a total cost of $511m.
The firm added, ‘With this debt repayment, Huntsman will achieve investment grade-type metrics with its trailing 12-month pro forma net leverage ratio for the third quarter is down to 1.8 times from 2.2 times.’
Paying off this debt will reduce the quarterly demand for cash by around $20m, on top of $70m/quarter saved from earlier debt repayments.
Peter Huntsman said, ‘This year, from the monetisation of Venator, together with the cash flow, we will have repaid $2.1 bn of debt, and in excess of $2.6bn since the beginning of 2016. We are focused on generating $400-600m free cash flow/year, and have yet to monetise the rest of Venator.
‘The strength of our balance sheet provides us with more flexibility than we have ever had to grow our differentiated and specialty business and increase value,’ he added.