Newsnomics AJAY ANGELINA reporter | Lotte Chemical will sell off its Pakistan subsidiary to a local chemical
company for 192.4 billion won ($156 million), in a bid to raise funds to focus on the advanced materials and
Eco-friendly products.
“The board of directors decided to sell its entire 75.01% stake of Lotte Chemical Pakistan Ltd. (LCPL), which manufactures 500,000 tons of purified terephthalic acid (PTA) a year, to Lucky Core Industries Ltd, Karachi,” said Lotte Chemical on Monday.
The announcement was first made by the chemical giant, and subsequently announced to the Pakistan Stock Exchange (PSX) by Lotte Chemical and LCI on Monday.
The notice by LOTCHEM Pakistan read, “The Board of Directors of Lotte Chemical Corporation, South Korea(“LCC Korea”), the majority (75.01%) shareholder of Lotte Chemical Pakistan Limited (“Company”) has approved and authorized the sale of all of the company’s shares held by LCC Korea (i.e., 75.01%) for the purpose of optimization of LCC Korea’s business portfolio, subject to execution of a share purchase agreement (“Proposed divestment”).”
The Korean news agency reported, “LCC would use the funds from the sale to bolster its advanced materials segment and make further inroads into sustainable chemical products, while upgrading the existing petro-chemical products used as feed stock for plastics.”
The sale of the Pakistani unit means that LCC will no longer engage in the PTA production. It shut down the domestic PTA production line in Ulsan, 307 kilometers southeast, in 2020. Lotte’s scrip at the course was traded at Rs 28.2, up by Rs 0.65 or 2.36 percent, with a turnover of 2.59 million shares on Monday.
Hwang Jin-koo, president of Lotte Chemical’s basic material business said, “the latest sell-off is our part of efforts to adjust the business portfolio to realize our visions for 2030.”
Kim Gyo-hyun, CEO of Lotte Chemical announced last year that, “the company is targeting annual revenue of 50 trillion won in 2030, of which 60 percent come from high-added value and Eco-friendly material businesses.”
The Pakistan unit reported an operating profit of 48.8 billion won based on revenue of 471.3 billion won in 2021.
Lotte Chemical Pakistan Ltd., has the capacity to produce 520,000 tons of PTA annually through its state-of-the-art plant located at Port Qasim, Karachi. It produces PTA, an essential raw material for Pakistan’s textile and PET packaging industries, and forms the backbone of the polyester chain, including Polyester Staple Fiber, Filament Yarn and PET (bottle grade) resin.
In addition to its own manufacturing facilities, the LOTCHEM has helped to create a large infrastructure net-
work at the Port Qasim vicinity, which includes a chemical jetty, raw water pipeline and manufacture of indu-
strial gases through third-party contracts.
