Braskem Idesa is negotiating with creditors for debtor-in-possession financing to potentially fund a Chapter 11 bankruptcy filing in the US, according to sources familiar with the matter. The Mexican petrochemical company, a joint venture between Brazil's Braskem SA and Grupo Idesa, has been struggling to restructure its debt amid mounting financial pressures.

Discussions are ongoing and a Chapter 11 filing remains uncertain, but the company has already missed multiple interest payments on its dollar notes. Last month Braskem Idesa failed to make a payment on notes due in 2032, following an earlier missed payment on 2029 notes. Fitch Ratings has downgraded the company to its second-lowest rating.

The company's cash position has deteriorated rapidly, holding just $46 million by the end of September compared to over $100 million in June. This liquidity crunch comes as Braskem Idesa's parent company Braskem also faces debt pressures and plans an out-of-court restructuring.