Headlines

Lyondell Chemical filed for bankruptcy protection citing waning demand for its products and asked for court approval of an $8 billion loan to help fund operations while it reorganizes, Bloomberg reported. The Chapter 11 filing yesterday was precipitated by a “dramatic softening in demand” as well as “unprecedented volatility in raw materials costs,” parent LyondellBasell Industries AF said in a statement. Lyondell Chemical listed $27.1 billion of assets and $19.3 billion of liabilities in the filing yesterday in U.S. Bankruptcy Court in New York.

According to a recent study conducted by Asian Banker Research, Malaysia is listed fourth in the Asia Pacific region's most creditor-friendly bankruptcy regimes where creditors can expect to recover more than 80 cents in the dollar of assets they are owed, the Malaysian national news agency reported. The findings of the study released today said Singapore and Japan were Asia Pacific region's most creditor-friendly bankruptcy regimes where creditors could expect to recover more than 90 cents in the dollar. Taiwan came third with a similar rate of recovery with Malaysia.

Struggling infrastructure house Babcock & Brown has warned it will become technically insolvent as it prepares to make a series of huge asset write-downs as part of efforts to push through the sale of its aircraft leasing and property businesses to pay down debt, The Age reported. But Babcock, which is being kept on life support by its banks, will avoid being placed into administration as it finalises the details of a debt-for-equity swap to secure a longer-term funding deal.

A failed business venture in China helped send Niagara Machine Products Corp. of St. Catharines into receivership, according to a representative of the company's Toronto receiver, Zeifman Partners Inc., The Standard reported. "They had a significant investment, a joint venture in China, and that went sideways," Allan Rutman said about the collaboration with Chinese steel producer Baosteel. Niagara Machine, which employs 210 workers, announced in a news release Monday that it is under receivership.

The Irish government has indicated that it may be ready to help current and former Ireland-based employees of Waterford Wedgwood to secure their pensions, after the luxury tableware company was put into receivership this week, the Financial Times reported. Waterford Wedgwood had a pension deficit of €111 million (£100 million) on October 4 which, together with its debts of just less than €450 million, are seen as the main issue for any prospective buyer.

Falling behind with council tax payments by only a few hundred pounds is increasingly tipping people towards bankruptcy as many town halls adopt a tougher approach to debts, the Times Online reported. With council tax bills doubling since Labour came to power, more homeowners are struggling to meet monthly payments and are falling into debt. Faced with a recession and budget squeezes, councils are increasingly using bailiffs and insolvency practitioners to get their money more quickly than by more conventional methods.

British retail industry stalwart Marks & Spencer Group PLC said Wednesday it will cut 1,230 jobs and close 27 of its stores in a drive to reduce costs as the retail sector continues to struggle, the Associated Press reported. Chairman Stuart Rose said in a statement the company suffered its worst quarterly revenue drop in a decade, with sales falling by 7.1 percent in the quarter ending Dec. 27. Rose said he expected "challenging" economic conditions to continue for at least the next 12 months.

Russia's gas price dispute with Ukraine escalated Tuesday, disrupting deliveries to the European Union in the midst of a bitter cold spell, with a number of countries reporting that gas supplies had been suspended or reduced, and Germany predicting a possible shortage, the International Herald Tribune reported. Bulgaria, Romania, Croatia, Macedonia, Turkey, Greece, the Czech Republic and Austria reported that gas supplies had been suspended or reduced after Gazprom, the Russian gas monopoly, reduced gas shipments through Ukraine.

KP Fashion Co., the company set up by the father of 16-year-old Russian fashion designer Kira Plastinina to sell her clothes in the U.S., filed for bankruptcy seven months after opening its first store, Bloomberg reported. Los Angeles-based KP Fashion sought protection from creditors while it liquidates. Plastinina’s father, Sergei Plastinin, has said he spent $80 million to set up stores for his daughter. The entrepreneur co-founded OAO Wimm-Bill-Dann, Russia’s biggest dairy company, and has investments in real estate, agriculture and fertilizer businesses.

Raw yarn producer Schoeller of India's fabrics producer Spentex Industries is in insolvency proceedings, the company’s head of personnel told Czech news agency CTK on Monday. The company has not paid wages for November or December. The fate of the plant and its 551 employees will be decided by the receiver and the creditor committee, he added. The company was running at full output at the end of the year, but customers have been unable to pay for supplied goods. Read more.