(Adds details on sales process, underfunded pensions, legal disputes and shares)
By Shivam Srivastava and Tracy Rucinski
Feb 8 (Reuters) - Noranda Aluminum Holding Corp, which smelts and refines aluminum and mines bauxite, filed for bankruptcy on Monday and joined a growing list of commodity-related businesses in Chapter 11.
Over the past year scores of commodity-related businesses have filed for bankruptcy as prices for metals, energy and coal have plummeted amid a slowdown in markets such as China and Brazil.
Noranda is putting its profitable flat-rolled products business up for sale to raise cash and is winding down a key smelting plant in New Madrid, Missouri, where production will halt around March, court documents showed.
The Franklin, Tennessee-based company, whose competitors include Alcoa Inc and Kaiser Aluminum Corp, said challenging market conditions made business without court protection unsustainable.
“This is due to a number of factors, principal among them is the sustained and dramatic decline in the price of primary aluminum,” Chief Financial Officer Dale Boyles said in a filing with the U.S. Bankruptcy Court of Eastern Missouri.
Noranda, with $530 million of secured debt, is seeking up to $130 million in debtor-in-possession (DIP) financing to help fund its business. It has already received commitments for about $35 million.
A failure to achieve adequate funding could force it to idle more facilities and liquidate on a piecemeal basis, CFO Boyles said.
The company, with 1,857 employees, also faces about $159 million in underfunded pensions as of Dec. 31, 2015. It has four collective bargaining agreements with two unions that represent about 54 percent of its U.S. workforce.
It said it will continue to operate a St. Ann, Jamaica, plant for bauxite that is refined into aluminum in its Gramercy, Louisiana plant, which will also remain open.
However, Noranda is in dispute with a bankrupt subsidiary of Glencore, Sherwin, over a supply contract at the Jamaica plant and is also in arbitration with the Jamaican government over an increased levy.
Noranda also owes another Glencore subsidiary nearly $17 million for payments under a credit agreement at the same plant.
Noranda, once owned by private equity firm Apollo Management LP, made its stock market debut in 2010 and traded at more than $116 per share in 2011. The stock was recently delisted from the New York Stock Exchange and now trades on the pink sheets. It was last down 80 percent at 6.3 cents.
The case is in U.S. Bankruptcy Court, for the Eastern District of Missouri, Case No 16-10083. (Reporting by Shivam Srivastava in Bengaluru and Tracy Rucinski in Chicago; Editing by Sunil Nair and Cynthia Osterman)