Goldman-Led Lenders Gird for Loss on Arclin Debt as Demand Cools

A group of banks led by Goldman Sachs Group Inc. is bracing for losses on a debt deal backing chemical maker Arclin Inc.’s acquisition of DuPont de Nemours Inc.’s Aramids business after investors balked amid concerns about the industry’s volatility.

Arclin’s $1.1 billion leveraged loan sold at just 92 cents on the dollar — a steep discount that forced the group of banks to absorb losses to cover the higher borrowing costs they had promised the company, according to people familiar with the matter.

Banks typically have some flexibility on the discount they can offer before eating ...