MOSCOW (MRC) -- South Korean producer Lotte Chemical is exiting the purified terephthalic acid (PTA) business with the sale of its 75.01% stake in LCPL (LOTTE CHEMICAL Pakistan Ltd), said Koreanpost.
This divestment is part of the company’s medium-term strategy to strengthen its high value-added specialty materials business.
LCPL, which produces 500,000 tonnes/year of PTA at Port Qasim in Karachi, will be sold to Pakistani chemical company Lucky Core Industries (LCI) for Korean won (W) 192.4bn (USD156m) – more than 13 times Lotte Chemical’s acquisition cost in 2009.
The buyer LCI is formerly known as ICI Pakistan, which produces polyester – a derivative product of PTA.
It produces 122,000 tonnes/year of polyester polymer and 135,000 tonnes/year of polyester fibres in Lahore; and 225,000 tonnes/year of soda ash in Khevra, according to ICIS Supply and Demand Database.
In South Korea in July 2020, the company ceased producing PTA at its 600,000 tonne/year plant in Ulsan, and converted it into a facility producing purified isophthalic acid (PIA).
The Ulsan plant’s current PIA capacity is 520,000 tonnes/year.
By 2030, the company is targeting high value-added specialty and eco-friendly material business to account for 60% of its total projected sales of W50tr (USD41bn).
Lotte Chemical plans to become carbon neutral in the same year, with plans to invest W4.4tr over 10 years on hydrogen production, in line with its target of supplying 30% of South Korea’s demand for the clean fuel.
We remind, Since the beginning of September 2022, Lotte Chemical has reduced the load on PP production in Yeosu and Daesan (Yeosu and Daesan Gudang, South Korea) by 20% since the beginning of September 2022. The total PP production capacity in Yeosu and Daesan is 1.23 million tonnes.