LyondellBasell Clears Bankruptcy Hurdle

LyondellBasell Industries has cleared a major obstacle to its bankruptcy reorganization. A committee of unsecured creditors has agreed to lift its objections to the company’s reorganization plan. In return, the creditors will receive $150 million in equity in addition to the $300 million payout they were already set to receive under a plan the company filed in bankruptcy court in December 2009. The equity will come out of shares in the firm that senior and bridge lenders will get in exchange for the $18 billion debt they hold. The settlement, along with the disclosure statement for the reorganization plan and other agreements, will be the subject of a March 1 bankruptcy court hearing. Lyondell spokesman David A. Harpole says the company expects to emerge from bankruptcy in the second quarter. He wouldn’t comment on Reliance Industries’ bid for LyondellBasell except to note that any third-party offers for the company would have to be an improvement over the value the lenders will get from the reorganization plan.