Port of Corpus Christi makes bid to purchase Sherwin Alumina property

The Port of Corpus Christi has put in a bid to buy the property of Sherwin Alumina Co., now wrestling with bankruptcy and a nearly two-year-long labor dispute, federal court records show.

The fifth-largest port of the USA has offered a bid totaling $32.9 million, and already has made a $2 million "good faith deposit" with a bank to move the process forward, according to documents filed Monday at U.S. Bankruptcy Court in Houston.

The port also looks to spend $13 million in capital, deferred maintenance, and environmental improvements in the area if Sherwin Alumina or another company continues to operate the nonport assets in the production of alumina. The Port Authority on Tuesday authorized its staff to close the purchase of the land.

In a letter included in the court filing, John P. LaRue, the port's executive director, said Sherwin Alumina would be a "natural fit" for the navigation district's portfolio. He described its bid as a "white knight" option for the company, which is restructuring under Chapter 11 bankruptcy.

The purchase, if approved, could help solve a problem for the port — a shrinking supply of waterfront property. It has become increasingly scarce around the port in recent years, with the construction of various industrial plants. That's especially true near Gregory, where Cheniere Energy's $11 billion liquefied natural gas facility and TPCO America Inc.'s $1.3 billion pipe manufacturing operation.

Located on State Highway 361 in Gregory, the Sherwin Alumina plant opened in 1953, but was acquired in 2007 Swiss-based multinational Glencore.

Alumina's uses includes airplanes, beer cans, fire-retardant carpet, seat cushions, toothpaste, deodorant, antacid and artificial marble. Sherwin Alumina filed bankruptcy in January citing a troubling combination of low alumina demand and an oversupply of it from China had crushed its bottom line. The company announced plans to sell its assets in exchange for forgiveness of $95 million in debt plus $250,000 in cash.

The plant is capable of producing 1.65 million tons of alumina annually, but produced just under 1.4 million tons in 2015. Its projected net operating losses were $42.1 million.

Sherwin Alumina owes between 1,000-5,000 creditors, and listed assets and liabilities each between $100 million and $500 million, court records show.