PTTGC + SCGC: Merger of Olefins and Polyolefins Businesses Planned

The Thai chemical companies PTT Global Chemical (PTTGC) and SCG Chemicals (SCGC) are planning to merge their olefins and polyolefins operations.

According to a press release, the two companies intend to establish a joint venture (JV), to which they will primarily contribute their respective production facilities at the Map Ta Phut petrochemical complex southeast of Bangkok. With a combined annual production capacity of 7.1 million tonnes of olefins and polyolefins, the JV would rank among the world's ten largest companies in the sector, according to the announcement.

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Under the current plans, the merger is expected to be completed by the middle of next year. By then, PTTGC and SCGC intend to transfer their olefins and polyolefins assets, currently held by various subsidiaries, into separate project companies, which will subsequently be merged. In a filing with the Bangkok stock exchange, PTTGC's corresponding assets are valued at THB 104.448 billion (EUR 2.78 billion), while SCGC's assets are valued at THB 82.066 billion (EUR 2.18 billion). This puts the total value of the JV at approximately THB 186.5 billion (EUR 4.96 billion). As a result, PTTGC will hold a majority stake of 56%, while SCGC will control the remaining 44% of the joint venture.

The merger is primarily a response to intensifying international competition. The two companies expect annual synergies of USD 150–200 million.

PTTGC CEO Narongsak Jivakanun stated: "This partnership aims to further strengthen Map Ta Phut's position as Thailand's petrochemical industrial hub and develop the site into a regional centre for petrochemical production. By combining our production capacities with the research and development expertise of PTTGC and SCGC, we will develop products and solutions that meet the needs of downstream industries. This will help Thai businesses, including small and medium-sized enterprises (SMEs), increase the added value of their products and strengthen their competitiveness in both domestic and export markets."

PTT Global Chemical is a subsidiary of Thailand's state-owned oil and gas group PTT. SCG Chemicals is the chemicals division of the Thai conglomerate Siam Cement Group (SCG).

More information: www.pttgcgroup.com, www.scgchemicals.com

PTT Global Chemical + SCG Chemicals, Thailand

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