Lyondell examiner probe should be expanded - creditors

23 December 2009 22:35  [Source: ICIS news]

HOUSTON (ICIS news)--Unsecured creditors of bankrupt producer Lyondell Chemical on Wednesday asked a US bankruptcy court judge to expand the scope of the case examiner’s investigation as a way to ensure that Lyondell fairly evaluates proposals from suitors such as Mumbai-based Reliance Industries.

The creditors said the Reliance bid - worth $10bn-12bn (€7-8.4m), according to news reports - was superior to the reorganisation plan offered by a group of senior lenders, according to a court filing made on Wednesday.

Georgia State University law professor Jack Williams was appointed as examiner in October, and released his report on Tuesday. The creditors are seeking to expand Williams’ mandate.

The creditors said Williams should also be allowed to investigate why Lyondell has given $440m in “adequate protection” payments to the company’s senior lenders during its bankruptcy period.

Lyondell, however, said those developments are simply part of the company's progression toward an emergence from bankruptcy protection and are being done in a fair and independent manner.

"We believe that assertions to the contrary are ill-founded and inconsistent with the interests of all stakeholders," company spokesman David Harpole said.

Lyondell Chemical is among the US units of LyondellBasell, which filed for bankruptcy protection in January following Lyondell’s December 2007 merger with Basell. The creditors argue that the deal doomed the company to fail.

($1 = €0.70)

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By: Ben DuBose
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