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Lyondell buy by RIL unlikely in 2009
Reliance Industries' bid to buy bankrupt petrochemicals firm LyondellBasell is unlikely to result in a deal in 2009 as the target evaluates its options, analysts and bankers say.
Reliance Industries' bid to buy bankrupt petrochemicals firm LyondellBasell is unlikely to result in a deal in 2009 as the target evaluates its options, analysts and bankers say.
"It is unlikely that anything will happen this year," a banking source familiar with the deal said.
Last week, Luxembourg-based LyondellBasell filed an amended reorganisation plan with a U.S. court, proposing a $2.8 billion (Rs 13,076 crore) rights issue, to simplify its corporate structure and exit bankruptcy protection with significantly less debt.
LyondellBasell said it continues to evaluate the Reliance proposal, which sources say may be worth as much as $12 billion (Rs 56,040 crore). If debtors choose to pursue a deal with Reliance, payment of any break-up fee to the rights offering sponsors will not be required, LyondellBasell said.
A court hearing on the amended reorganisation plan will not be held until after a February hearing on the validity of a settlement with a U.S. unit's creditors.
"Lyondell will be evaluating both plans concurrently and the understanding that we have is that clarity will not emerge for at least the next month or two," said Deepak Pareek, an oil and gas analyst at Angel Broking.
"It will take a while for clarity to emerge on all fronts — price, value, synergies for Reliance and the reorganisation plan."
