By Malini Hariharan
LyondellBasell's board is reported to have rejected Reliance Industries' revised $14.5bn buyout offer.
The rejection is not surprising as LyondellBasell is said to have valued itself at $15.5bn in its restructuring plan.
Reliance still has room to up its offer although financial analysts are worried that a high-priced deal would not be favourable to shareholders. And this was evident in the stock market today with Reliance shares moving up in reaction to the latest news reports. Investors perceived the rejection to be positive as it saves Reliance from making an expensive buy.
But if an acquisition makes sense then it is probably time for Reliance to be more aggressive and place an offer that LyondellBasell would find difficult to reject.
Meanwhile in another interesting twist to the story, the New York Post says that Apollo Management, the private equity company which is one of LyondellBasell's key creditors is looking at merging the company with Hexion Speciality Chemicals. Apollo has an investment in Hexion.