On the 19th, LOTTE Chemical is showing a rise of over 5%. This is attributed to news of securing cash by selling its Pakistan subsidiary.
At 2:26 p.m. on that day, LOTTE Chemical is trading at 69,100 won, up 3,400 won (5.18%) from the previous trading day.
LOTTE Chemical is set to enter into a stock purchase agreement (SPA) with Pakistani investment firm Asia Park Investment and UAE petrochemical company Montage Oil DMCC consortium, transferring 75.01% equity of its Pakistan subsidiary. The contract amount is approximately 9.79 billion won.
LOTTE Chemical acquired a 75.01% equity stake in this subsidiary for 14.7 billion won in 2009. The site mainly produces high-purity terephthalic acid (PTA), with an annual production capacity of 500,000 tons. However, due to recent low-price competition from China, the profitability of PTA has worsened, prompting the sale.
With the sale of the Pakistan subsidiary, LOTTE Chemical has also accelerated its ongoing financial restructuring efforts. LOTTE Chemical is reducing borrowing funds through asset liquidation overseas.