Kronos Worldwide, Inc. Announces Private Offering of an Additional €75 Million of 9.50% Senior Secured Notes Due 2029

Rhea-AI Summary

Kronos Worldwide (NYSE:KRO) has announced a private offering of €75 million in additional 9.50% Senior Secured Notes due 2029 through its subsidiary Kronos International, Inc. These notes will supplement the existing €351,174,000 in notes issued in February and July 2024.

The new notes will maintain identical terms as the existing ones and will be fully guaranteed by KRO and its domestic subsidiaries. The proceeds will primarily be used to pay amounts due under the company's 3.75% Senior Secured Notes due September 15, 2025, or to repay any draws from its Wells Fargo credit facility used for the same purpose.

Positive

• None.

Negative

• High interest rate of 9.50% on the new notes
• Increasing debt load with additional €75 million in notes

Insights

Fixed Income Analyst

Kronos is raising €75M in additional debt at 9.50% primarily to refinance maturing debt, maintaining its leverage position rather than reducing it.

Kronos Worldwide is conducting a €75 million add-on offering to its existing €351.17 million of 9.50% Senior Secured Notes due 2029. This additional debt issuance is specifically structured to address the company's 3.75% Senior Secured Notes maturing on September 15, 2025 - essentially a refinancing operation rather than new capital for growth initiatives.

The significantly higher interest rate on the new notes (9.50% versus 3.75% on the maturing debt) reflects the substantially higher interest rate environment compared to when the original notes were issued. This increased borrowing cost will negatively impact interest expense and cash flow going forward.

The notes will carry the same security package as the existing notes - first-priority security interests in certain assets plus guarantees from the parent company and domestic subsidiaries. This indicates the company isn't having to offer enhanced security to attract investors, suggesting reasonable market acceptance despite the high-yield nature of the offering.

The transaction structure as an add-on to existing notes rather than a new standalone issuance typically suggests efficiency in execution and potential for slightly better pricing than a new issue would command. Maintaining the company's existing debt maturity schedule without creating a new maturity date demonstrates prudent liability management.

Dallas, Texas, Sept. 03, 2025 (GLOBE NEWSWIRE) -- Kronos Worldwide, Inc. (NYSE: KRO) (the “Company”) announced today that it is seeking to raise debt capital through a private offering of €75 million aggregate principal amount of additional 9.50% Senior Secured Notes due 2029 (the “Notes”) by its wholly-owned subsidiary, Kronos International, Inc. (“KII”). The Notes are being offered as additional notes to the existing €351,174,000 aggregate principal amount of 9.50% Senior Secured Notes due 2029 that KII issued on February 12, 2024 and July 30, 2024 (the “Existing Notes”). Other than with respect to the date of issuance and issue price, the Notes will have the same terms as the Existing Notes. The Notes will be maintained under the same ISIN and Common Code numbers as the Existing Notes, except that the Notes issued pursuant to Regulation S under the U.S. Securities Act of 1933, as amended (the “Securities Act”), will trade separately under different ISIN and Common Code numbers until 40 days after the issue date of the Notes, but thereafter, the Notes issued pursuant to Regulation S will be maintained under the same ISIN and Common Code numbers as the Existing Notes issued pursuant to Regulation S.

The Notes will be fully and unconditionally guaranteed, jointly and severally, on a senior basis by the Company and each of its direct and indirect domestic, wholly-owned subsidiaries (other than the Issuer, the “Guarantors”), subject to certain exceptions and secured by first-priority security interests in certain assets of the Company and the Guarantors.

The completion of the offering depends on several factors, including market conditions. The Company intends to use the proceeds of the offering, after payment of fees and expenses, to pay amounts due under its 3.75% Senior Secured Notes due September 15, 2025 at maturity (or, alternatively, to repay any amounts the Company may draw under its global revolving credit facility with Wells Fargo to repay such notes at maturity). The Company intends to use any remaining net proceeds for its general corporate purposes.

This press release shall not constitute an offer to sell, or the solicitation of an offer to buy any of the Notes nor shall there be any sales of the Notes in any jurisdiction in which such offer, solicitation or sale would be unlawful without registration or qualification under the securities laws of any such jurisdiction. This notice is being issued pursuant to and in accordance with Rule 135c under the Securities Act.

The Notes and related guarantees subject to the private placement have not been and will not be registered under the Securities Act, or any state securities laws, and will be offered only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act and in offshore transactions to non-U.S. persons (within the meaning of Regulation S) outside the U.S. that are not “retail investors” residing in a member state of the EEA or the UK. The Notes and related guarantees may not be offered or sold in the United States or to U.S. persons except pursuant to registration under or an exemption from the registration requirements of the Securities Act and applicable state securities laws.

About the Company

Kronos Worldwide, Inc., incorporated in Delaware in 1989, is a leading global producer and marketer of value-added titanium dioxide pigments, or TiO₂, a base industrial product used in a wide range of applications. The Company, along with its distributors and agents, sells and provides technical services for its products to approximately 3,000 customers in 100 countries with the majority of its sales in Europe, North America and the Asia Pacific region. The Company believes it has developed considerable expertise and efficiency in the manufacture, sale, shipment and service of its products in domestic and international markets.

Forward-Looking Statements

The statements in this press release relating to matters that are not historical facts are forward-looking statements that represent management’s beliefs and assumptions based on currently available information. These forward-looking statements include, among others, statements about the potential outcome or effect of the notes offering or the use of proceeds therefrom. Although Kronos believes the expectations reflected in such forward-looking statements are reasonable, it cannot give any assurances that these expectations will prove to be correct. Such statements by their nature involve substantial risks and uncertainties that could significantly impact expected results, and actual future results could differ materially from those described in such forward-looking statements. The factors that could cause actual future results to differ materially include, but are not limited to, uncertainties relating to market conditions for corporate debt securities generally and for the securities of specialty chemical companies and for Kronos in particular. Such factors also include those identified in the Company’s most recent annual and quarterly reports filed with the Securities and Exchange Commission.

* * * * *

This news release is for informational purposes only and is not an offer to sell, or the solicitation of an offer to buy, securities.

Investor Relations Contact

Bryan A. Hanley
Senior Vice President and Treasurer
Tel. 972-233-1700

FAQ

What is the purpose of Kronos Worldwide's (KRO) €75 million notes offering in September 2025?

The offering is primarily to pay amounts due under KRO's 3.75% Senior Secured Notes maturing September 15, 2025, or to repay any draws from its Wells Fargo credit facility used for the same purpose.

What is the interest rate on KRO's new notes offering and when do they mature?

The new notes carry a 9.50% interest rate and are due in 2029, matching the terms of the existing notes issued in February and July 2024.

How much is the total amount of KRO's 9.50% Senior Secured Notes after this offering?

After this €75 million additional offering, the total amount will be €426,174,000, including the €351,174,000 in existing notes from previous issuances.

Who is eligible to purchase KRO's new notes offering?

The notes are only offered to qualified institutional buyers under Rule 144A and non-U.S. persons in offshore transactions under Regulation S, excluding retail investors in the EEA or UK.

How are KRO's new notes secured?

The notes are secured by first-priority security interests in certain company assets and are fully guaranteed by Kronos Worldwide and its domestic subsidiaries.