According to reports by a number of large news organizations, including Forbes, Reuters, and the Wall Street Journal, Netherlands-based LyondellBasell Industries, considered the world’s third-largest independent chemical company, and a leading producer of plastic resins, particularly polyolefins, told lenders on December 29, 2008 it is considering bankruptcy in light of rapidly falling sales and a cash crunch. On the following day, a company spokesperson declined to comment on the situation, saying the company’s policy is to not comment on rumors.
The company was formed in 2007 when the Dutch chemicals firm Basell International bought Houston, TX-based Lyondell Chemical Co. in a $12.7 billion cash deal. Basell then was a division of New York-based Access Industries, a privately held firm founded by Russian-born investor Leo Blavatnik. According to its website, LyondellBasell’s annual sales are around $54 billion and it employs 16,000 people worldwide. Company affiliates, including Equistar, have recently idled several chemical and polymer plants, including those at Chocolate Bayou and LaPorte, TX.
The Wall Street Journal reported that both Access and LyondellBasell have hired large law firms as bankruptcy advisers, but added that doing so does not automatically mean a company will seek Chapter 11 protection. The advisers sometimes work to create a restructuring agreement that keeps the company out of bankruptcy court.