UPDATE 1-Tronox misses interest payment

By Chelsea Emery

NEW YORK, Dec 2 (Reuters) - Tronox Worldwide LLC, a maker of titanium dioxide pigment used in paint, coatings, plastic and paper, said on Tuesday it did not make a scheduled payment of debt interest that was due on Dec. 1, putting the company on the path to default if it can't make a payment within 30 days.

The wholly owned subsidiary of Tronox Inc TROXA.PK said it missed an interest payment on its $350 million of 9-1/2 percent senior notes due 2012, according to a U.S. Securities and Exchange Commission filing. Fitch Ratings said the interest payment is about $16.6 million.

If the Oklahoma City-based company fails to make a payment within 30 days, it is considered in default, permitting some holders to declare the full amount of the notes immediately due and payable, the filing said.

The company said again that it is evaluating strategic options, including mitigation of environmental liabilities and capital restructuring.

In a Nov. 7 SEC filing, the company said that it may need to seek relief from creditors under a Chapter 11 bankruptcy filing if other options including land sales and development opportunities were unsuccessful.

Company spokesman Robert Gibney on Tuesday declined to comment further.

WAIVER

The missed interest payment comes only a few days after the company said on Nov. 26 it had negotiated a waiver extension with its banks to avoid defaulting on another credit agreement. That waiver will last until either Dec. 5, or if any other event of default that is not being waived takes place.

Though the defaults under that waiver have been pushed off, no further borrowing is available through the waiver period.

"They haven't had access to liquidity for a while," said Monica Bonar, a director at Fitch Ratings. "They don't have access to their credit availability under their bank facilities. They would have their cash on hand as well as any cash generated in earnings, but I can't imagine it's a lot."

Since August, all three major credit rating agencies have downgraded the company's debt.

In its downgrade in November, Fitch said growth rate projections for titanium dioxide "are modest" and tend to track overall economic activity.

Fitch said the company has reduced head count, cut its dividend and reduced capital spending. Since September the company has also raised prices for titanium dioxide around the world.

The company's shares traded down 3 cents, to 4 cents on the over-the-counter market. (Reporting by Chelsea Emery; Editing by Brian Moss)