Lotte Chemical lists Malaysian unit
Lotte Chemical listed the shares of its Malaysian unit on the stock market there, raising about 1 trillion won ($870 million) in fresh funds, the company said Tuesday.
Lotte Chemical Titan floated 2.38 billion shares on the Kuala Lumpur Stock Exchange, worth 4 trillion won. Of the 2.38 billion shares, 25 percent are traded on the bourse, while the remaining 75 percent are held by Lotte Chemical.
The company said it secured nearly 1 trillion won by selling shares to individual and institutional investors.
Huh Soo-young, the head of Lotte Group’s chemical business unit, and other group executives attended a bell ringing ceremony to mark the initial public offering (IPO) on the Kuala Lumpur Stock Exchange, Tuesday.
In 2010, Lotte acquired a 100 percent stake in Malaysia’s largest chemical producer for 1.5 trillion won. Now Lotte Chemical Titan, which produces mostly ethylene, polyethylene and polypropylene, is worth 4 trillion won.
It plans to use 1 trillion won to expand its production capacity and establish a plant in Indonesia.
“Lotte Chemical Titan is one of the major chemical firms in Southeast Asia. It has been playing a key role in transforming the parent firm into a major global player,” Lotte Chemical CEO Kim Gyo-hyun said. “The IPO will improve its financial health and make it possible to expand investment in Malaysia and other Southeast Asian nations.”
In 2016, Lotte Chemical Titan earned 2.29 trillion won in sales with a 506 billion won operating profit.
Kim said Lotte Chemical became the first unit of Lotte Group that owns a listed unit in Southeast Asia.
“Under the leadership of group Chairman Shin Dong-bin, the company has been aggressively acquiring other chemical firms at home and abroad. Taking over Titan in 2010 was a turning point for Lotte Chemical, which has since emerged as a major global player,” he said. “It has also become a main cash cow for Korea’s fifth-largest conglomerate.”
In 2015, Lotte Chemical bought chemical business units of Samsung Group and built a natural gas processing plant in Uzbekistan. In 2018, it will open a joint plant in the United States with U.S. chemical firm Axiall.
