Access Industries still eyes Lyondell, JP Morgan

29 June 2007 09:42  [Source: ICIS news]

MUMBAI (ICIS news)--JP Morgan said on Friday US-based Access Industries’ interest in rival Lyondell Chemical has increased following its proposed $9.6bn merger with Huntsman.

 

A Lyondell-Huntsman and Access Industries-owned Basell - a polyolefins producer - combination could create $475m (351.5m) in synergies, the brokerage said.

 

JP Morgan maintained its 2007 and 2008 earnings per share (EPS) estimates on Lyondell Chemical of $3.40 and $3.30, respectively. Its EPS forecast for this year’s second quarter was $1.33, compared with 62 cents for the same period a year ago, the brokerage added.

 

“Our 2007 estimate reflects stronger refining and methyl tertiary butyl ether margins, partly offset by higher ethylene feedstock costs and weaker construction demand,” JP Morgan said.

 

The brokerage has an “overweight’ rating on Lyondell Chemical and it expected the stock to outperform due to likely stable and high levels of free cash flow generation and an improved valuation relative to its petrochemical peers.

 

Shares of Lyondell were up 1.54% to $36.92 at Thursday’s close on the New York Stock Exchange (NYSE).

 

($1 = €0.74)

By: Isha Jha
+65 6780 4359

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