The favourite company of Twitter investors has collapsed, Venator has declared bankruptcy. What's next?

So this is definitely the event of the week! The British chemical company Venator declared bankruptcy in the USA, the financial group J&T and the Czech investor Michal Šnobr invested in the company since last year, later joined by hundreds of investors from the Czech Republic and Slovakia.

The crazy culmination of the saga called Venator 👇

Venator $VNTR estimates the value of its assets and debts to be between one and ten billion dollars (up to CZK 217 billion), according to a request for court protection from creditors. The company said it has more than 5,000 creditors and estimates it will have the means to pay unsecured creditors.

Venator shares are traded on the New York Stock Exchange. The company turned to consulting firms last year to help it improve liquidity and cut costs.

J&T Group and investor Šnobr announced last May that they had acquired a 9.42 percent stake in the company. They became the second-largest shareholder. The investment was made by a new SICAV fund that J&T and Šnobr jointly set up. The fund gradually increased its stake.

In an open letter earlier this year, the fund criticised the chemical company's management and its financial performance. It also said it held 14.3 percent of the company's shares. In response to the letter, the British company said, among other things, that it had adopted a cost-cutting programme and that it planned to divest its iron oxides business.

Commenting on the company's results in February, chief executive Simon Turner stressed that macroeconomic conditions "continued to be challenging". He also said that the company had cut spending and planned to reduce inventories to match demand.

For those who don't know the company 👇

Venator Materials PLC is a global manufacturer and marketer of chemical products. Its products contain a wide range of pigments and additives that protect and extend product life and reduce energy consumption.

The company sells its products to a globally diversified group of industrial customers through two segments, Titanium Dioxide, which consists of TiO2 business, and Performance Additives, which consists of functional additives, color pigments, wood treatment, and water treatment.

I firmly believe that everyone who invested here acted in their own self-interest and did not make decisions as part of a "crowd frenzy". I have followed the Venator situation here on Bulios in the past and did an interview with Tomas Hajek where both the positives and negatives of this company were heard 👇.

Venator through the eyes of an experienced investor.

Excerpt from the interview:

Do you perceive other risks? For example, the possibility of bankruptcy?

I would definitely not recommend having VNTR as the main stock in your portfolio. But as I mentioned above, the current liquidation value of the company should be well above its market price. On the other hand, the company continues to burn cash, and unless there is a projected turnaround next year, it may struggle to refinance the larger tranches of debt due in 2024. However, the company still has a lot of assets, so I wouldn't see it as overly dramatic. I'm rather suspicious of the intentions of the controlling shareholder, we'll see what time brings.

Please note that this is not financial advice.