Lotte Chemical Corp., a major South Korean chemical company, will merge with Lotte Advanced Materials Co., a specialty material subsidiary that it acquired in 2016.
The company announced that it held a board meeting on Aug. 22 and decided to merge with Lotte Advanced Materials. The two companies will sign a merger agreement on Aug. 23 and complete the merger on Jan. 2, 2020.
The merger will allow Lotte Chemical to strengthen its market competitiveness by more actively responding to customer needs. It will also allow the company to raise its profitability through cross selling of compounding products for vehicles. Lotte Chemical is planning to increase efficiency further by integrating support divisions for R&D and purchasing.
The merger will also boost Lotte Chemical’s polycarbonate (PC) production capacity. Lotte Advanced Materials is capable of producing 240,000 tons of PC. Lotte Chemical has been expanding its PC facility in Yeosu since 2017 to increase annual output to 220,000 tons. The expansion work will be completed in the second half of this year, making Lotte Chemical the third largest PC manufacturer in the world.