Reliance (RIL, Mumbai; www.ril.com) apparently has sweetened its takeover offer for insolvent polyolefins giant LyondellBasell (Rotterdam / The Netherlands; www.lyondellbasell.com). The Indian conglomerate is now said to be bidding USD 13.5 bn, up from the USD 12 bn it offered several weeks ago – see Plasteurope.com of 23.11.2009. Some reports say LyondellBasell has rejected the latest offer, even though a spokesman said in late December that the group’s delaying its exit from Chapter 11 “does not preclude” Reliance making a bid. “If there is a superior bid, there is an option to take it on,” he said – see Plasteurope.com of 21.12.2009.

Unsecured creditors initially were believed to be favouring a deal with Reliance, while several large shareholders and creditors, including private equity investors, were seen to be dragging their feet, pending approval of the reorganisation plan, now scheduled to be heard by a New York court on 10 February. Just before Christmas LyondellBasell downplayed this issue, announcing that it would settle with these creditors out of court, if the court agreed to the payment of USD 300m for the purpose.

At the same time the group said investors Apollo and Ares Capital as well as Access Industries, the investment vehicle of pre-bankruptcy sole owner Len Blavatnik, had signed an Equity Commitment Agreement (ECA) promising to backstop the USD 2.8 bn rights issue outlined in the reorganisation plan, through the purchase of shares not already subscribed.

In any case, Reliance seems to have no intention of backing away from its acquisition plans. Reports from India say the industrial group recently raised USD 577m through a share sale, after increasing capital in September 2009. Financial sources say Reliance is also talking to banks about loans for its proposed deal. Along with participating in the rights issue, it is also said to be offering a cash sum.