M&A

2 November, 2009

Judge approves examiner for Lyondell

NEW YORK, Nov 2 (Reuters) - A U.S. judge overseeing the bankruptcy case of chemicals maker Lyondell Chemical Co [ACCELC.UL] has approved the appointment of law professor Jack F. Williams as an examiner to review a portion of the company's reorganization, according to court documents.

The appointment comes in response to a request by Lyondell's official committee of unsecured creditors, who said the company had "lost sight of its fiduciary responsibility" to all of the company's creditors.

Williams, a law professor at Georgia State University College of Law in Atlanta, Georgia, will report to U.S. Bankruptcy Judge Robert Gerber on selected areas of how the company is reorganizing its business operations.

Professor Williams is expected to monitor and report on how the company considered a rights-offering sponsor, as well as the soundness of Lyondell's judgment in deciding not to refinance a debtor-in-possession facility and on aspects of a proposed litigation reserve.

Judge Gerber approved the appointment in documents dated Oct. 30.

Williams specializes in business and bankruptcy law research on duties of directors and officers of insolvent corporations and financial fraud and corporate accounting issues, according to a Georgia State website.

Williams was also a former resident scholar for the American Bankruptcy Institute

Lyondell is among the U.S. units of LyondellBasell [ACCEIN.UL], which filed for bankruptcy protection in January, unable to meet its debt obligations after demand dropped for petrochemicals products during the global economic downturn.

LyondellBasell, the Luxembourg-based holding company, is owned by investor Len Blavatnik through New York-based Access Industries.

LyondellBasell had taken on billions of dollars of debt obligations when Access Industries led a 2007 buyout. The official committee of unsecured creditors has argued that the merger set the company up to fail.

The bankruptcy case is In re: Lyondell Chemical Co., U.S. Bankruptcy Court, Southern District of New York, No. 09-10023. (Reporting by Chelsea Emery, editing by Gerald E. McCormick)

Source: http://www.reuters.com