Resins and chemicals giant LyondellBasell Industries AF SCA is considering filing for Chapter 11 bankruptcy protection.
``We are looking at restructuring our debt and are exploring all of our options,'' the company said in Dec. 31 news release. ``Filing for Chapter 11 protection is one of those options.
``We are working collaboratively with our banks to find the most efficient way to restructure.''
Spokeswoman Susan Moore said the company would not comment beyond the release.
The Wall Street Journal, citing unnamed sources, said Access Industries Inc., the New York-based firm that owns LyondellBasell, has hired law firm Skadden, Arps, Slate, Meagher & Flom LLP as a bankruptcy adviser. LyondellBasell has hired Cadwalader, Wickersham & Taft LLP as its bankruptcy counsel.
The report said LyondellBasell wants to get up to $2 billion in bankruptcy financing.
LyondellBasell was formed in 2007 when Basell International Holdings BV paid $12.7 billion to buy Lyondell Chemical Co. of Houston. In February, the company added to its compounding capacity with the purchase of Solvay Engineered Polymers of Mansfield, Texas, a major polypropylene compounder.
But in recent months, Rotterdam, Netherlands-based LyondellBasell has been hurt by a decline in chemical prices while it carries a heavy debt load.
The firm stressed in a Dec. 30 news release that it was not in default of its bank agreements. The statement was a response to a Standard & Poor's news release indicating LyondellBasell was in selective default to Standard & Poor's corporate credit rating.
The ratings agency downgraded LyondellBasell's credit rating.
LyondellBasell is the world's largest maker of polyolefins. The company is the No. 1 maker of PP in North America and the world. The company also holds the No. 2 slot in both high and low density polyethylene in North America.
The company also is active in the Asia-Pacific region. Including a recently opened compounding plant in Nansha, China, LyondellBasell has 110 million pounds of annual compounding capacity in China.