LyondellBasell files new reorganisation plan, mulls Reliance bid

14 December 2009 20:37  [Source: ICIS news]

HOUSTON (ICIS news)--LyondellBasell’s filing of an amended reorganisation plan calling for a $2.8bn (€1.9bn) rights issue represents a step forward as it attempts to emerge from Chapter 11 bankruptcy protection, a spokesman for the producer said on Monday.

The plan was filed on Friday with a US bankruptcy court, proposing a $2.8bn rights issue while paying a maximum of $428m in administrative, tax and other priority claims and repaying the new money portion of its debtor-in-possession (DIP) loan in full.

Lyondell also said it would continue to evaluate an offer from Mumbai-based Reliance Industries worth $10bn-12bn, according to reports.

“We have prepared an amended disclosure statement and plan that we believe has the support of the majority of our secured lenders and is in the best interests of our estate,” said Lyondell spokesman David Harpole.

Harpole said the company’s next steps would be to set a date for a court hearing to confirm the plan and then to seek creditor and shareholder approval.

However, that would not come until after a February hearing regarding the validity of a proposed $300m cash payment from the company, designed to partially settle a lawsuit filed by unsecured creditors of Lyondell Chemical. Those creditors called the figure “woefully inadequate” in a court filing last week.

“We are pleased that the court has agreed to a single hearing in February to determine whether we can settle the unsecured creditors’ suit, as well as rule on its fairness,” Harpole said. “We anticipate that the hearing for confirmation of the disclosure statement can occur afterward.”

Harpole said the court hearings would not preclude Reliance from making a bid for the company, if it chooses to do so.

($1 = €0.68)

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By: Ben DuBose
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