Korea’s Lotte Chemical revives plan to sell its Bursa-listed subsidiary

Lotte Chemical Corp is reintroducing its strategy to sell its Bursa Malaysia-listed subsidiary, Lotte Chemical Titan Holding Bhd (LCTitan), along with a stake in its Indonesian unit, according to the Korea Economic Daily. The South Korean petrochemical giant had paused the sales procedures for its Malaysian and Indonesian entities following the start of the US-Iran conflict earlier this year, the daily reported yesterday.

Korean government sources cited by the newspaper indicate that Lotte Chemical is evaluating market conditions and seeking potential buyers, with its unprofitable Malaysian unit as the main focus. The company is also engaging in discussions with Indonesia's sovereign wealth fund, Danantara, regarding the partial sale of its Indonesian subsidiary.

These proposed sales come amidst a difficult period for the global petrochemical industry, which is dealing with an oversupply of products. In March 2024, reports stated that Lotte Chemical was looking for buyers for LCTitan and had engaged with both local and foreign firms as well as private equity companies. The potential sale was estimated to be around US$600 million (RM2.44 billion).

Lotte Chemical holds nearly 75% of LCTitan, established in 1989 and one of Southeast Asia's largest producers of olefins and polyolefins, with 12 plants in Pasir Gudang and Tanjung Langsat, Johor. The Korean group acquired Titan Chemical Corp Bhd (now LCTitan) from Malaysia's The Chao Group and Permodalan Nasional Bhd’s (PNB) in 2010 for US$1.25 billion (RM5.07 billion).

LCTitan was removed from Bursa Malaysia in 2011 and later reinstated in 2017 with a market value of about RM15 billion. Consistent losses have eroded its share price by over 90%, currently trading at just 31 sen, making the company worth RM716.8 million. LCTitan's financial situation worsened in the second quarter of 2026 (Q2 FY2026) due to inventory write-downs and higher costs from its new Indonesian plant, resulting in a net loss of RM174.19 million for the period, up from RM173.09 million a year earlier.

Revenue, however, increased by 116.4% to RM3.11 billion, mainly due to the Lotte Chemical Indonesia New Ethylene project, which began operations in October 2025, and higher selling prices.