Lyondell CAM rallies with DIP refinancing calls

Bankrupt chemical giant Lyondell’s non-roll up CAM (collateral allocation mechanism) rallied by eight to nine points last week, Barclays analysts say.

The rally was driven by certain of Lyondell entities’ secured noteholders – Arco (pre-LyondellBasell entity) and Equistar (Lyondell Chemical subsidiary) – calling for a refinancing of the debtor-in-possession facility, set to expire on 15 December. According to analysts, these specific creditors were discontent with the lack of protection extended through the current DIP structure and also believe that the DIP can be refinanced at better rates.