LyondellBasell privately places $2.75 billion in senior secured notes
25 March 2010
Dutch petrochemical major LyondellBasell today announced the private placement of approximately $2.750 billion of senior secured notes maturing in 2017. These include $2.250 billion of 8 per cent senior secured notes ("dollar notes") and euro 375 million of 8 per cent senior secured notes ("euro notes"), both issued at par.
The issue of notes, under Rule 144A and Regulation S, is scheduled to close on 8 April 2010, the company said in a release.
The notes will be issued by LBI Escrow Corporation, which will merge with and into Lyondell Chemical Company on its emergence from bankruptcy, which is expected to occur on or about 30 April 2010, subject to confirmation of a plan of reorganisation. (See: LyondellBasell plans $3.25 billion debt financing for Lyondell Chemical).
LyondellBasell entities also are arranging a senior term loan facility of approximately $500 million and a $1.750 billion asset-based revolving credit facility for working capital and general corporate purposes.
Proceeds of the notes offering and term loan will be placed in escrow until the approval of the Plan of Reorganisation. The net proceeds from the sale of the notes, together with borrowings under the term loan and a new European securitisation facility and proceeds from a $2.800 billion rights offer, will be used 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.
Upon emergence from bankruptcy, the notes and term loan will be senior secured obligations of Lyondell Chemical and 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.