08 December 2009 16:58 [Source: ICIS news]
HOUSTON (ICIS news)--LyondellBasell plans to propose a $300m (€201m) cash payment to partially settle a lawsuit filed by unsecured creditors, an offer that would remove significant hurdles in the company's emergence from bankruptcy protection, a spokesman said on Tuesday.
If approved by the bankruptcy court, the settlement would resolve claims filed against the lenders connected to Lyondell Chemical's merger with Basell, said David Harpole, company spokesman.
However, claims against corporate parent Access Industries and former directors and executives would remain pending.
A committee representing unsecured creditors sued Access, the lenders and the directors, accusing them of pursuing the doomed merger to pocket millions in fees. The committee alleges that the merger drove Lyondell into Chapter 11 bankruptcy protection.
Harpole said that Lyondell planned to file a motion with the court in the upcoming days. The company is allowed to propose such a settlement if it is in the best interest of the debtor.
"We believe that this proposed settlement is in the best interest of all constituencies and allows us to proceed to emerge from Chapter 11 in an expeditious manner," he said.
As part of the proposed settlement, the unsecured creditor committee would be named the beneficiary of a litigation trust, which will be created to pursue the pending claims against the other parties named in the lawsuit, Harpole said.
A trial, initially scheduled for Thursday, has been postponed while the bankruptcy court reviews the settlement offer, Harpole said.
Lyondell's plans to leave bankruptcy protection through a stock offering.
($1 = €0.67)
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