Lotte Chemical Accelerates Sale of Pakistan Subsidiary...Local Investor Submits Letter of Intent

Sale of Non-Core Assets Accelerates
Acquisition Price Expected to Be Around 100 Billion KRW

Sale of Lotte Chemical's Pakistan subsidiary is gaining momentum. The sale process appears to be nearing its final stage as local investors and others have submitted letters of intent to acquire.

According to industry sources on the 16th, on the 13th, Pakistan investment firm Asia Park Investment and UAE petrochemical company Montaj Oil DMCC submitted letters of intent to acquire Lotte Chemical Pakistan Limited (LCPL), which is listed on the Pakistan Stock Exchange.

LCPL, in which Lotte Chemical holds a 75.01% stake, operates non-core businesses such as the production of purified terephthalic acid (PTA). The company is pursuing restructuring of some non-core subsidiaries and businesses to secure financial soundness and shift its business portfolio. On the 7th, Kim Min-woo, head of Lotte Chemical's Strategic Planning Division, mentioned during an earnings conference call that "meaningful progress has been made with potential buyers," and that the sale of LCPL is expected to conclude soon.

The exact acquisition amount has not been disclosed, but the industry estimates it to be in the range of 100 billion KRW.

LCPL was acquired by Lotte Chemical in 2009 for approximately 14.7 billion KRW. It has the capacity to produce 500,000 tons annually of PTA, which is used in polyester fibers, industrial yarns, and PET bottles.

In January 2023, LCPL signed a contract to sell shares to Pakistan chemical company Lucky Core Industries (worth about 192.4 billion KRW), but the contract was canceled in January of last year.