Reliance Industries Ltd has increased its bid to acquire LyondellBasell to US$13.5 bln from the earlier offer of US$12 bln. In the proposed offer, RIL will acquire US$2.2 bln in new stock and support a separate US$2.8 bln rights offering by LB, which would enable it to come out of bankruptcy.
However, LyondellBasell board is not very enthused about the offer, as the company, in its proposed restructuring plan, has valued the company at US$15.5 bln. RIL will be able to acquire the company only after its restructuring is complete. A final official bid by RIL will be submitted in early February before the court hearing on restructuring on February 10.
Led by the biggest lender, Apollo Group; the secured lenders of LB gave an offer to convert their US$18 bln debt into equity and also agreed to infuse an additional US$2.8 bln through the subscription of fresh shares of the company. Weighing an increased chance of recovering money with RIL, the unsecured lenders are supporting RIL.