MUMBAI/NEW YORK - LyondellBasell filed a restructuring plan on Monday, rejecting a takeover bid from Reliance Industries Ltd in favour of commitments from private equity firms, including Apollo Management LP, to help the chemicals maker exit bankruptcy.
Lyondell filed for bankruptcy more than a year ago, hobbled by billions in debt, a sharp increase in oil prices and a decline in demand for its polymers and chemicals due to the global economic crisis.
Since then, LyondellBasell has reached agreement with its creditors to shed billions in debt, issue equity to debtholders and raise about $2 billion to finance its bankruptcy exit.
"We will have a new management team in place, we will have considerably less debt, and we will be adequately capitalized with the equity from the rights offering as well as exit financing," said company spokesman David Harpole. "We will be a much leaner, more efficient company and a stronger competitor in the global chemical and polymers industry."
The company has rejected several offers from Reliance Industries, the most recent of which valued the petrochemicals firm at $14.5 billion, in favour of a plan supported by key creditor groups, said Harpole.
"The amended plan provides superior value, improves the financial stability of the reorganized company and is a confirmable plan," said Harpole.
The company in February reached a $450 million settlement with unsecured creditors over a lawsuit stemming from its 2007 leveraged buyout. The settlement helped clear the way for the company to put the final touches on its reorganization plan.
