17 July 2007 20:41 [Source: ICIS news]
HOUSTON (ICIS news)--Moody's Investors Service put debt ratings of Basell and Lyondell under review for downgrades on Tuesday, following Basell's announcement of a $19bn (€14bn) bid to buy Lyondell.
In its review of Lyondell, Moody's said it also will consider debt ratings for the company's subsidiaries, Equistar Chemical and Millennium Chemicals.
Moody's said that as part of the review it will consider Basell's strategic rationale behind the acquisition, the risks and synergies involved with combining the companies, financial structure of the acquisition and credit characteristics of the combined companies.
In addition, Moody's said it will consider the combined company's future financial policy and prospects for debt reduction.
Basell likely will fund much of the acquisition with debt, which could deteriorate the company's debt metrics, Moody's said.
On 26 June the service had placed Basell's ratings under review for downgrade, following the company's unsuccessful attempt to acquire Huntsman for $9.6bn.
Huntsman chose a $10.6bn bid from Hexion Specialty Chemicals instead.($1 = €0.73)
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