SEOUL (dpa-AFX) - South Korea's HD Hyundai Co., Ltd. (267250.KS) and Lotte Chemical Corp. (011170.KS) on Wednesday announced that they have submitted a plan with the South Korean Government for restructuring their petrochemical businesses.
The companies in separate regulatory filinings said they have submitted the application for approval review of the joint business reorganization Plan to the Ministry of Trade and Industry. The restructuring plan is designed to rationalize naphtha cracker or NCC facilities, which have been pointed out as a structural oversupply issue in the domestic petrochemical industry.
Under the 'Act on the Promotion of Corporate Vitalization' plan, Lotte will carry out a physical division of its key production site DaeSan plant in South Korea, and merge it with HD Hyundai Chemical. The companies expect to establish an integrated operational framework for the production of petrochemical products, including NCC facilities.
Lotte added, 'Following the merger, the consolidation of petrochemical production functions within the DaeSan Industrial Complex is expected to enhance the consistency and operational stability of production processes, thereby strengthening the overall effectiveness of the restructuring initiative.'
With the move, Lotte plans to reinforce the stability of its business structure and increase its focus on core businesses, thereby enhancing its mid- to long-term business foundation.
With the deal, Lotte Chemical, jointly with HD Hyundai Oilbank Co., Ltd. and HD Hyundai Chemical Co., Ltd., aim to participate in the implementation of measures to enhance the competitiveness of the petrochemical industry and contribute to the restructuring of the domestic petrochemical sector.
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