LyondellBasell plans $3.25 billion debt financing for Lyondell Chemical
12 March 2010
LyondellBasell, which on Thursday received court approval for a major restructuring plan, today said its wholly owned subsidiary, Lyondell Chemical Company, plans to raise $3.25 billion, including private placement and long-term loans.
The financing plan includes raising first priority debt, including "an offering of senior secured notes in a private placement and borrowings under a senior term loan facility (term Loan)," the company said in a release.
LyondellBasell, which last week rejected a $14.5 billion takeover offer from Reliance Industries, also plans a rights offering of $2.8 billion to existing creditors, including US buy-out firm Apollo Management. (See: Apollo may gain as LyondellBasell rejects Reliance's $14.5 billion bid: report).
The company would use the net proceeds from the debt issue and rights offer of about $6.25 billion, upon emergence from bankruptcy, to repay and replace certain existing debt, including debtor-in-possession credit facilities and an existing European securitisation facility and to make certain related payments, the release said.
The senior secured debt obligations of Lyondell Chemical will be guaranteed by LyondellBasell Industries NV (the new Dutch parent of the LyondellBasell group) and, subject to certain exceptions, substantially all wholly owned US restricted subsidiaries of LyondellBasell Industries NV.
The debt will not be offered or sold in the United States or to US persons acting in proxy. "The Notes will be offered only to "qualified institutional buyers" in accordance with Rule 144A under the Securities Act and to non-US persons in accordance with Regulation S under the Securities Act," the release said.
This, however, does not constitute an offer to sell or a solicitation of an offer to buy any securities, the release said.