LyondellBasell cut debt from $24B to $7.2B in Chapter 11 and rebuilt a chemicals leader

On January 6, 2009, LyondellBasell's U.S. subsidiaries and a German holding company filed Chapter 11 in New York after the 2008 credit crunch exposed the debt from the Lyondell Chemical acquisition.

The plan of reorganization, approved by the court on April 23, 2010 and effective April 30, 2010, converted senior and bridge debt into equity, with exit financing of $3.25B of senior secured notes and a $2.8B rights offering.

The company emerged with about $7.2B of total debt versus about $24B before filing, roughly $10B of equity value, and a streamlined portfolio of chemicals, polymers and refining.

By 2012 sales and other operating revenues reached $45.4B with operating income of $4.7B, compared with $2.3B in 2010.

Emerged April 30, 2010 with about $7.2B of debt versus about $24B pre-filing and about $10B of equity value; by 2012 sales reached $45.4B with $4.7B operating income.

DIP financing and continued operations kept customers and cash flow through the 15-month case.

Creditors voted overwhelmingly for a plan that swapped debt for equity, avoiding a fire sale of assets.

Management cut costs early, removing about 2,370 employees and 4 billion pounds of annual polymer capacity.

The new balance sheet let LyondellBasell invest in core plants and technology licensing afterward.

DIP financing and a fast creditor vote kept plants running through the case; the decision was to convert debt to equity and cut peripheral capacity rather than sell the core in pieces.

LyondellBasell became one of the world's largest chemicals and polymers producers, reporting $3.4B of income from continuing operations on $34.7B of sales in 2019 and returning cash to shareholders from 2013 onward. The 2010 case became a reference for how a large industrial group can reorganize without liquidation.