LOTTE Chemical announced on the 6th that it will secure an additional 650 billion won in funding by utilizing its equity in its Indonesian subsidiary, LCI (PT Lotte Chemical Indonesia), through a price return swap (PRS) contract. The plan is to ensure financial soundness through this.
Established in 2016 for constructing a petrochemical plant with an ethylene capacity of 1 million tons in Indonesia, LCI plans to commence commercial production this year. LOTTE Chemical will utilize 25% of its 49% equity in LCI to secure 650 billion won in funding. This funding is planned to be used for improving financial structure through repayment of borrowing funds.
LOTTE Chemical secured a total of 1.3 trillion won in funding through the additional funding utilizing the LCI equity, having also signed a PRS worth 660 billion won last October using a 40% equity share in LCLA (Lotte Chemical Louisiana LLC), its ethylene glycol (EG) production corporation in the U.S.
The company decided to liquidate its Malaysian synthetic rubber production company LUSR last October and, in February of this year, sold its Pakistani PTA (purified terephthalic acid) subsidiary LCPL, thereby improving its financial structure through an asset light strategy.
LOTTE Chemical noted, "We will proceed with stable funding through various means and will prioritize ensuring financial soundness by re-evaluating new investments from a conservative perspective."