LyondellBasell Industries NV (LYB) Message Board

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Gold/Mining/Energy : LyondellBasell Industries NV (LYB)

LYB 46.42

+2.7%

Oct 31 9:30 AM EDT

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From: Savant	10/21/2011 12:07:46 PM
	of 98

2nd UPDATE: LyondellBasell Unveils Debt Buyback, Special Dividend Last Update: 10/21/2011 11:28:01 AM --Chemical company unveils tender for $2.79 billion in debt --LyondellBasell intends to pay $2.6 billion special dividend --Liquidity after dividend and new financing to be at least $3 billion (Updates with comment from LyondellBasell spokesman and recent share price) DOW JONES NEWSWIRES LyondellBasell Industries NV (LYB) said one of its units would offer to buy back up to $2.79 billion in debt across a series of notes as the company said it seeks to improve its credit rating. Shares climbed 10% to $30.12 in recent trading as the company also said in a filing with the U.S. Securities and Exchange Commission it plans to return up to $2.6 billion to shareholders though a special dividend. The Lyondell Chemical Co. said it will begin a cash tender offer for up to $1.47 billion of its 8% senior secured notes due in 2017 and up to $1.32 billion of its 11% senior secured bonds due 2018. The offers also include early tender premiums. The offer expires Nov. 21, and the early tender deadline is Nov. 2. A parade of companies have bid to buy back debt lately, many of them funding their offers with new note offerings as interest rates sit near historic lows. Netherlands-based LyondellBasell said it will finance its special dividend through existing cash and proceeds of a new debt financing. The company has liquidity of $6 billion of cash and about $2.2 billion of unused committed credit lines. LyondellBasell spokesman David Harpole said the company believes a special dividend is the best approach for returning value to shareholders. "Dutch law would impose a 15% withholding tax on a stock buyback program given our short dividend payment history, so a special dividend is preferred under our unique circumstances," he said. He said details on the timing and per-share amount of a special dividend will be announced at a later date. Immediately following the dividend and new debt financing, the company expects its liquidity to be at least $3 billion and its total funded debt to be less than $5 billion. LyondellBasell, which has significant operations in the U.S., has seen business conditions and results improve across the vast majority of its business, notably in the olefins and polyolefins and propylene oxide businesses. The company emerged from Chapter 11 bankruptcy protection last year. In August, the company authorized a dividend of 20 cents a share, twice the level of the chemical company's initial dividend unveiled in May.

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