Atlantic Richfield - Further re Exchangeable Notes

RNS No 8870r
ATLANTIC RICHFIELD CO
15th September 1997
 
ARCO PROCEEDS TO SETTLE 9% EXCHANGEABLE NOTES WITH LYONDELL PETROCHEMICAL CO.
COMMON STOCK
 
Los Angeles, September 15 (UNS) - Consistent with its previously announced
plans, ARCO (NYSE: ARC) today proceeded to settle its 9% Exchangeable Notes
due today with Lyondell Petrochemical Company stock owned by ARCO. The
exchange rate is 0.9904 shares of Lyondell Common Stock for each Note.
 
ARCO expects to realize an after-tax gain of approximately $300 million upon
the exchange.
 
Prior to the settlement, ARCO owned 39.9 million shares, or 49.9% of the total
outstanding shares of Houston-based Lyondell (NYSE: LYO), a leading
manufacturer and marketer of petrochemicals and, through its interest in
LYONDELL-CITGO Refining Company, a manufacturer of refined petroleum products.
 
In a 1994 offering, ARCO sold $988 million of 3-year Exchangeable Notes
carrying a 9.0% annual coupon and payable, upon maturity, in shares of
Lyondell stock or, at ARCO's option, in cash with an equal value. ARCO had
previously determined to exchange Notes for stock, stating that Lyondell is no
longer central to its core business.
 
Under the terms of the Notes, the exchange rate of 0.9904 shares of Lyondell
Common Stock per Note was based on the maturity price of $24.99 per share of
Lyondell Common Stock, which is equal to the average closing price per share
of Lyondell Common Stock on the New York Stock Exchange over the 20 trading
days ending Sept. 12, 1997.
 
The Notes were structured so that ARCO would retain the first 12% in stock
price appreciation above the $24.75 issue price. Since the maturity price is,
in fact, higher than the issue price, ARCO will retain a small shareholding in
Lyondell. ARCO's retained shareholding will total approximately 384,000 shares
of Lyondell Common Stock, which the company intends to sell from time to time
as it deems appropriate.
 
For a menu of ARCO news releases, visit our Web site at http://www.arco.com on
the Internet.
 
Contact: Albert Greenstein, media, tel California 001-213-486-3384, or Steve
Enger, investor relations, tel [phone], both of ARCO
 
 
 

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