LOTTE Chemical is accelerating asset light and business restructuring by divesting non-core operations.
LOTTE Chemical announced on the 20th that it will sell its membrane production plant for water treatment, located in the Daegu National Water Industry Cluster, with a total floor area of 5,775 square meters, to Synopex. The two companies plan to complete the transaction in July after signing a sales transfer agreement and going through the main implementation steps. The sale amount will not be disclosed due to confidentiality obligations.
The Daegu water treatment plant has been in full commercial production since 2019 and manufactures and sells membranes for wastewater treatment (domestic and industrial wastewater) and purification (tap water and industrial water) based on membrane UF (Ultra Filtration). LOTTE Chemical noted, "We have strategically decided to divest the water treatment business to focus on fostering and enhancing high value-added specialty materials and new growth businesses," adding, "We will continue management innovation activities to enhance the company's profitability and secure fundamental competitiveness, as well as to advance our portfolio through business restructuring."
Earlier, LOTTE Chemical secured approximately 1.7 trillion won in cash by quickly advancing the business structure transformation through asset light. In the first half of this year, it sold its 75.01% stake in its Pakistan-based purified terephthalic acid (PTA) production and sales subsidiary, LCPL (LOTTE Chemical Pakistan Limited), securing about 97.9 billion won. It also raised funds of about 650 billion won by utilizing its 25% stake in its Indonesian subsidiary, LCI (PT Lotte Chemical Indonesia). In addition, it sold a 4.9% stake in a Japanese company, Rezonac, for 275 billion won.
Last year, it raised funds of about 660 billion won by leveraging a 40% equity stake in its ethylene glycol (EG) production company, LCLA (LOTTE Chemical Louisiana LLC) in the U.S., and liquidated its synthetic rubber production company, LUSR (LOTTE UBE Synthetic Rubber Sdn. Bhd.) based in Malaysia.