Fitch affirms Lyondell Chemical, Equistar ratings

Fitch Ratings said it has affirmed Lyondell Chemical Co.'s senior secured credit facility rating at BB-, senior secured notes at BB-, and senior subordinated notes at B.

Fitch has also affirmed the BB- rating on Equistar Chemicals LP's senior secured credit facility and the B rating on Equistar's senior unsecured notes.

The outlook remains negative for both Lyondell and Equistar.

Fitch said the negative outlook for both companies reflects Fitch's concern that margins at Lyondell and Equistar will continue to remain under pressure into 2004. In addition, Fitch is concerned with the uncertainty in the overall economy, energy and raw materials costs, and the pace of improvement in demand.

Lyondell is refinancing its existing $85 million accounts receivable securitization program and replacing it with a new four-year, $100 million accounts receivable purchase program. Equistar is also replacing its existing $354 million senior secured revolving credit facility and $100 million accounts receivables securitization program with a new four-year, $250 million inventory revolving credit facility, and a four-year, $450 million accounts receivables purchase program.

Fitch said the ratings continue to be supported by both Lyondell and Equistar's strong access to liquidity via senior secured credit facilities and capital market transactions.

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