Moody's may downgrade Lyondell

Moody's Investors Service said it placed the Ba3 corporate family and probability-of-default ratings and B1 senior unsecured bond ratings of Lyondell Chemical Co., Equistar Chemical Co. LP and Millennium Chemicals Inc. under review for possible downgrade following the announcement that Lyondell has agreed to be acquired by Basell AF SCA in a transaction worth roughly $19 billion including the assumption of debt.

Also under review are Lyondell's Ba2 senior secured bank credit facility and senior secured bond ratings and Millennium Chemical's B1 senior unsecured convertible bond rating.

The agency said its review will focus on financing of the proposed transaction, the financial metrics of the combined company, its financial policies and the prospects for meaningful debt reduction over the next two to three years and its strategy for future global growth. Financing for the transaction has not yet been disclosed

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