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LOTTE Chemical sells its Pakistani PTA subsidiary as part of its efforts to strengthen its high-value specialty materials business.
2023.01.16
LOTTE Chemical sells its Pakistani PTA subsidiary as part of its efforts to strengthen its high-value specialty materials business.
■ Selling LCPL, a Pakistani PTA production and sales subsidiary, to secure approximately KRW 192.4 billion in funds.
■ Planning to focus core capabilities to on expanding sales of environmentally friendly high value-added products such as PE, PP, and EVA for membranes and facilitating early establishment of new future businesses, including, hydrogen energy business, and organic solvents for battery use.
■ Planning to focus core capabilities to on expanding sales of environmentally friendly high value-added products such as PE, PP, and EVA for membranes and facilitating early establishment of new future businesses, including, hydrogen energy business, and organic solvents for battery use.
LOTTE Chemical is selling off non-core overseas businesses to strengthen its high value-added specialty materials business.
LOTTE Chemical has announced that it will hold a board meeting to sell its entire stake of 75.01% in its Pakistani subsidiary, LCPL, which produces and sells PTA, to Lucky Core Industries, a Pakistani chemical company, for approximately KRW 192.4 billion.
LOTTE Chemical plans to use the funds secured from the sale to strengthen the value-added properties of existing petrochemical products such as PE, PP, and PET, expand its specialty business, and enter into the eco-friendly material sector.
To enhance its business competitiveness, LOTTE Chemical has stopped operating its PTA plant at the Ulsan plant since the second half of 2020 and has been producing PIA through facility conversion. With the recent sale of its Pakistan PTA subsidiary, the company will no longer produce the product.
PIA is a product used as a raw material for PET, coatings, unsaturated resins, and other materials, and LOTTE Chemical's annual production capacity of PIA is 520,000 tons, making it the world's largest producer with the highest market share.
LOTTE Chemical announced at a press conference last year that as part of its plan to achieve KRW 50 trillion in sales by 2030, it aims to generate approximately KRW 30 trillion, or 60% of total sales, from its high value-added specialty and eco-friendly material businesses.
LOTTE Chemical has announced that it will hold a board meeting to sell its entire stake of 75.01% in its Pakistani subsidiary, LCPL, which produces and sells PTA, to Lucky Core Industries, a Pakistani chemical company, for approximately KRW 192.4 billion.
LOTTE Chemical plans to use the funds secured from the sale to strengthen the value-added properties of existing petrochemical products such as PE, PP, and PET, expand its specialty business, and enter into the eco-friendly material sector.
To enhance its business competitiveness, LOTTE Chemical has stopped operating its PTA plant at the Ulsan plant since the second half of 2020 and has been producing PIA through facility conversion. With the recent sale of its Pakistan PTA subsidiary, the company will no longer produce the product.
PIA is a product used as a raw material for PET, coatings, unsaturated resins, and other materials, and LOTTE Chemical's annual production capacity of PIA is 520,000 tons, making it the world's largest producer with the highest market share.
LOTTE Chemical announced at a press conference last year that as part of its plan to achieve KRW 50 trillion in sales by 2030, it aims to generate approximately KRW 30 trillion, or 60% of total sales, from its high value-added specialty and eco-friendly material businesses.
LCPL was acquired by LOTTE Chemical in 2009 for approximately KRW 14.7 billion. Despite the challenges of global economic uncertainties, LCPL recorded sales of KRW 47.13 billion and operating profit of KRW 48.8 billion in 2021. However, it has been deemed to be not in line with LOTTE Chemical's mid- to long-term vision of expanding its high value-added specialty business, leading to the decision to sell off the subsidiary.
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