Media: South Korea’s Lotte Chemical to sell 25% stake in Indonesian subsidiary

Lotte Chemical Corporation (LCC) has announced plans to sell a 25% stake in its Indonesian subsidiary, Lotte Chemical Indonesia (LCI), through a Price Return Swap (PRS) agreement. The move aims to strengthen LCC’s financial position amid ongoing challenges in the petrochemical sector.

If finalized, the transaction would reduce LCC’s ownership in LCI from 49% to 24%. The sale is expected to generate approximately USD 462.7 million, which will be used to repay debt and improve financial stability.

LCI was established in 2016 as a joint venture between Lotte Chemical Corporation (49%) and Lotte Chemical Titan Holding Bhd (51%) to develop a one-million-ton ethylene production facility in Indonesia. Despite LCC’s divestment plan, Lotte Chemical Titan Holding Bhd (LC Titan) has opted to maintain its 51% stake. In an official filing with Bursa Malaysia, LC Titan confirmed its decision not to participate in the stake sale.

"The board of directors of LC Titan wishes to announce that the Board had deliberated and made a decision not to accept the offer by LCC to purchase the sale shares held by LCC in LCI for USD 462.7 million," the company stated.

This latest move follows LCC’s sale of a 40% stake in its US ethylene glycol (EG) subsidiary in October 2024, also via a PRS deal, which raised USD 432 million.