The two banks that agreed to provide the funding for the troubled $6.5bn (€5.2bn) buyout of Huntsman Corporation by Apollo Management-backed Hexion Speciality Chemicals have withdrawn their backing hours ahead of its scheduled close this morning amid concerns over the merged group’s solvency. It is latest stumbling block in the deal struck 15 months ago at the height of the leveraged finance boom.

In a statement released early this morning Huntsman said it had been advised by Hexion that Credit Suisse and Deutsche Bank did not believe that a solvency opinion and certificate proposed to be provided would meet the condition of the commitment letter. As a result, Huntsman said the banks did not plan to fund the proposed closing of the merger.