Lotte Chemical bids acquire Singapore's Jurong Aromatics

Lotte Chemical bids to acquire Singapore's Jurong Aromatics

9:48 AM, 23rd January 2017
Lotte Chemical logo

SEOUL, SOUTH KOREA: Lotte Chemical Corp is looking into acquiring troubled Singapore petrochemical company Jurong Aromatics Corp (JAC), as the South Korean company continues to push for growth.

JAC went into receivership in September 2015, struggling with debt problems in the face of a global commodity rout at that time.

It was also forced to halt production for around 18 months until last summer to fix a technical issue at an integrated refining-petrochemical complex in Singapore that had cost around $2.4 billion to build.

Lotte Chemical said on in a filing to the stock exchange in South Korea that it had submitted a letter of intent earlier this month on the possible acquisition of JAC.

"We are studying whether it would be worth acquiring JAC with the letter of intent," said Jung Seung-han, a Lotte Chemical spokesman, adding that it was too early to give other details or put a possible value on the deal.

An industry source in Singapore said that a bidding process had started for JAC, but declined to give details or name companies involved. He did not want to be identified as he was not permitted to speak with media.

JAC's facilities include a 100,000-barrel per day condensate splitter and petrochemical units, which produce paraxylene, a raw material for textiles and plastic bottles that are often churned out in China.

An acquisition would also potentially boost the supply of petrochemical feedstock naphtha to Lotte Chemical, as well as consolidating its position as one of the largest condensate buyers in Asia, said a Singapore-based trader.

Lotte Chemical currently operates two naphtha cracking centres in the South Korean cities of Yeosu and Daesan, with a combined ethylene output of 2.1 million tonnes per year (tpy).

The company also co-owns a 130,000-bpd condensate splitter with Hyundai Oilbank Co that started operations last year.

Lotte Chemical has also said that it would invest about $215 million to increase its ethylene capacity to 1.2 million tpy by 2018.

© Reuters News 

0 Comments

Login

Your Comments (Up to 2000 characters)
Please respect our community and the integrity of its participants. WOC reserves the right to moderate and approve your comment.

Related News


AkzoNobel repurchased shares worth €10.07 million

AMSTERDAM, NETHERLANDS: AkzoNobel NV has repurchased 164,000 of its own ordinary shares in the period from 16 January 2017 up to and including 20 Janu ...

Read more
Solvay, Marubeni, Ansaldo to invest in new energy efficiency project

BRUSSELS, BELGIUM/ GENOVA, ITALY/ TOKYO, JAPAN: Solvay SA announced the formation of a joint venture with Marubeni Europe plc (Marubeni) and Ansaldo E ...

Read more
AkzoNobel leads an initiative to buy green power from Bouwdokken wind farm

AMSTERDAM, NETHERLANDS: AkzoNobel NV is leading a consortium of companies, including DSM, Google and Philips, in signing a multi-year contract for the ...

Read more
Shell to sell stake in Sadaf Chemicals JV for $820 million

THE HAGUE, NETHERLANDS: Royal Dutch Shell plc and Sabic have signed an agreement whereby Sabic will acquire Shell’s 50 percent share in the petr ...

Read more
Manganese oxides used in treatment system could be mixed blessing

RALEIGH, US: Researchers at North Carolina State University (NCSU) have found that some black sludge growing in a water-treatment site could have rede ...

Read more
Scientists develop new catalysed reaction using iron salts

HUDDERSFIELD, UK: Scientists at the University of Huddersfield have developed a new chemical reaction that is catalysed using simple iron salts &ndash ...

Read more