Lotte Chemical Raises 650 Billion KRW Using Stake in Indonesian Subsidiary

Raising funds through a Price Return Swap agreement using LCI stake
Securing 1.3 trillion KRW by leveraging overseas subsidiaries
Pursuing financial stability through asset-lightening strategies

Lotte Chemical announced on the 6th that it will raise additional funds by entering into a Price Return Swap (PRS) agreement using its stake in its Indonesian subsidiary LCI (PT Lotte Chemical Indonesia).

LCI was established in 2016 to build a petrochemical plant with an ethylene capacity of 1 million tons in Indonesia, and commercial production is planned for this year. Lotte Chemical plans to raise approximately 650 billion KRW by utilizing 25% of its 49% stake in LCI. The funds will be used to improve the financial structure through debt repayment.

In October last year, Lotte Chemical signed a PRS worth 660 billion KRW using its 40% stake in LCLA (Lotte Chemical Louisiana LLC), an ethylene glycol (EG) production company in the United States, and through the additional fund raising using the LCI stake, it has secured a total of 1.3 trillion KRW.

Additionally, at the end of October last year, the company decided to liquidate LUSR, a synthetic rubber manufacturer in Malaysia, and in February earlier this year, it sold LCPL, a high-purity terephthalic acid (PTA) subsidiary in Pakistan, pursuing financial structure improvement through asset lightening strategies.

Lotte Chemical stated, “We will proceed with stable funding through various methods and prioritize securing financial soundness by conservatively reviewing new investments.”