LyondellBasell to exit bankruptcy, go public

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LyondellBasell Industries AF SCA, the world's largest polyolefins maker, plans to exit bankruptcy in December or January.

After exiting bankruptcy, the Rotterdam, Netherlands-based firm intends to have an equity offering and to become publicly traded sometime in 2010, spokes- man David Harpole said in an Oct. 6 telephone interview.

“We've met all of our milestones to date,” Harpole said. “We're on schedule and are continuing to work with our lenders.”

LyondellBasell also has accomplished about 40 percent of its job-reduction goal, but plans to cut another 1,800 positions worldwide by the end of 2010. Most recently, the firm cut 14 workers at a plant in Corpus Christi, Texas, that makes plastic feedstocks ethylene, propylene, butadiene and benzene. Closing a low density polyethylene plant in Carrington, England, by the end of the year will eliminate 50 jobs.

The firm also had planned to close a high density PE plant in Alvin, Texas, but reversed its decision after the plant's finances improved and HDPE demand bounced back somewhat.

Harpole declined to provide site-by-site details, but he said the overall goal of 3,000 reductions announced in November 2008 represented about 17 percent of LyondellBasell's global workforce at the time.

“That doesn't mean it's going to be 17 percent of the jobs at each location,” said Harpole, who is based at North American headquarters in Houston. “Some locations could see more than that and some could see less.”

In an Oct. 6 teleconference, LyondellBasell officials said earnings for the firm's polymers segment through August — before interest, taxes, depreciation amortization and restructuring costs — were $528 million. That's 75 percent higher than what the firm expected the polymers unit to produce at this point at the start of the year. Through August, the polymers unit was the most productive of LyondellBasell's four segments, based on pre-charge earnings.

In the first half of 2009, LyondellBasell's sales fell 53 percent to $13.2 billion vs. the year-ago period. The firm posted a first-half loss of $1.4 billion after showing a $5 million profit in the same period a year ago. In 2008, LyondellBasell posted a loss of $7.3 billion on sales of $50.7 billion.

Ownership of LyondellBasell is split 50-50 between investment firms Access Industries of New York and ProChemie Holding Ltd. of Oberndorf, Germany.

Access bought Basell from BASF AG and Royal Dutch/Shell Group for $6 billion in 2005 and in 2007 acquired Lyondell Chemical Co. for $19 billion. In bankruptcy court filings, LyondellBasell has said that the acquisition of Lyondell was done with 100 percent debt financing.

Global economic turmoil and lower plastics and chemicals demand hit LyondellBasell hard in 2008, leading many of its units to file for bankruptcy in January of 2009. Access then sold half of the business for an undisclosed amount in May to ProChemie.

LyondellBasell ranks as the largest maker of polypropylene in both North America and the world. In North America, the firm also ranks second in markets for HDPE and LDPE.

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