Texas Petrochemicals closes on $130 million financing, emerges from Chapter 11

New York, May 7 - Texas Petrochemicals said it closed on a $130 million financing package and emerged from bankruptcy on May 6.

The financing is made up of:

* $20 million raised from the sale of equity to Castlerigg Master Investments, Ltd., an affiliate of Sandell Asset Management Corp., RCG Carpathia Master Fund, Ltd., an affiliate of Ramius Capital Group, LLC and unsecured creditors that chose to participate in a rights offering under the plan of reorganization;

* $60 million from the sale of 7.25% senior secured convertible notes due 2009 to the Sandell and Ramius funds and unsecured creditors participating in the rights offering; and

* a $50 million revolving credit facility from LaSalle Business Credit, Inc. and Congress Financial Corporation.

Following the reorganization and before conversion of any of the convertibles, the company is now owned 20% by Sandell and Ramius and 80% by the unsecured creditors. Sandell and Ramius own 63% of the convertibles and the creditors 37%.

The notes convert into 107 shares per $1,000 face amount.

Pre-petition bank debt will be repaid, leaving the company with $32 million of availability on its revolver for general corporate purposes.

Texas Petrochemicals, a Houston chemical company, filed for Chapter 11 in July 2003 in the U.S. Bankruptcy Court for the Southern District of Texas. It had $209.55 million in 11 1/8% senior subordinated notes while Texas Petrochemicals Holdings has $57.65 million in discount notes outstanding.

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