JAKARTA (TheInsiderStories) – Korean retail giant Lotte said on Dec. 21 it has purchased two Indonesian synthetic resin makers, according to local media reports.
Lotte Advanced Materials, the chemical arm of Lotte, has signed a deal to wholly purchase PT Arbe Styrindo and PT ABS Industri Indonesia. Lotte did not disclose costs to acquire the two firms, which are controlled by the same main shareholder.
The two firms are the only two Indonesian makers of acrylonitrile butadiene styrene resin widely used in plastic parts in household goods, tech products and automobiles, according to Lotte. Their two factories have been suspended since October due to financial difficulties.
Lotte Advanced Materials said it will focus on normalizing the two plants‘ operation and boosting their combined annual production capacity to 73,000 tons from the current 40,000 tons.
Lotte’s goal is to begin commercial production at the facilities from 2019 and reach an annual revenue of 200 billion won (US$185 million) and an operating profit of 15 billion won.
In this mid-year, South Korean chemical company Lotte Chemical Titan, is set to realize its US$4 billion investment plan in Indonesia, to produce naphtha cracker with a capacity of 2 million tons per year. Naphtha cracker is raw material for producing ethylene, propylene and its derivative products.
During his visit to South Korea, Minister for Industry Airlangga Hartato said, Indonesia is now focusing on developing the petrochemical industry as one priority of the country’s development program as this sector has important role in supplying raw materials for many manufacturing businesses in the downstream segment such as plastic, textile, paint, cosmetics, and pharmacy industry.
Indonesia Government wants to boost the economic cooperation with South Korea, the 3rd largest country investing in the manufacture industrial sector in Indonesia. South Korea’s firms have invested $7.5 billion in Indonesia for past five years, contributing up to 71 percent of total investment in said period. They absorb around 900,000 Indonesian workers.
Written by Elisa Valenta, email: email@example.com