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LG Chem picks first CEO from outside group

LG Chem said Friday it nominated Shin Hak-cheol, vice chair and executive vice president of 3M, as its new head. It is the first time the chemical company hired a chief executive from outside the company since its foundation in 1947. Current LG Chem CEO Park Jin-su climbed the ladder during his 42-year career at the company.

LG Chem said it has been looking for a person who can systemize global business operations as overseas production and marketing of lithium-ion batteries has increased along with demand for electric cars.

“Shin has gained global perspective and experience in operating a global materials and components business,” LG Chem said in statement. “He is the right person capable of responding to a rapidly changing business environment and bringing change in corporate culture and structure.”

Shin started at 3M Korea in 1984 as a technical supervisor and then joined 3M Philippines in 1995 as its managing director. In 2011, he was named executive vice president of 3M International Operations, becoming the first Korean to lead 3M’s overseas businesses, LG Chem said.

His most recent role at 3M was leading global teams, including the research and development, strategy and business development and business transformation teams, as vice chair and executive vice president at the 3M headquarters in Saint Paul, Minnesota.

Shin will begin commute to work and be officially inaugurated as the chief executive during the shareholders meeting in March.

Park will retire as Shin is inaugurated, but the exact date has not been announced yet. The company grew into a 28 trillion won ($24.8 billion) company under Park. In 2011, it posted around 22.6 trillion won in sales.

Industry analysts say this may be the beginning of a major transformation at LG under the leadership of 40-year-old Chairman Koo Kwang-mo.

November 13, 2018

LG Chem to build China facility

LG Chem said Tuesday that it will invest 2.1 trillion won ($1.8 billion) by 2023 to build electric vehicle batteries in China in the latest move to meet growing demand for batteries for zero-emissions cars. Korea’s top chemical company said it has broken ground on a three-story plant on the 198,300-square-meter (49 acre) site in Nanjing in southeastern China.

The plant is set to roll out electric vehicle batteries that can power more than 500,000 electric vehicles. The first phase of production is set to begin late next year.

An electric vehicle equipped with LG Chem batteries can travel about 320 kilometers (198 miles) on a single charge, according to LG Chem.

LG Chem Vice Chairman and CEO Park Jin-soo said the second plant in China will allow the company to better meet rapidly growing global demand.

LG Chem has another electric vehicle battery plant in Nanjing. It also operates electric vehicle battery plants in Korea, the United States and Poland.

The electric vehicle battery market has been on the rise as automakers around the world race to go electric due to tightened regulations on greenhouse gas emissions, which scientists say are to blame for global warming.

Currently, LG Chem is a key supplier of batteries to U.S. auto giant General Motors, Volvo and Renault, as well as Korea’s largest carmaker, Hyundai Motor, and its smaller affiliate, Kia Motors.

October 25, 2018

Lotte chemical to expand polyethylene manufacturing unit in Malaysia

Lotte Chemical Corp., the compound unit of Lotte Group, has extended its polyethylene plant in Malaysia to support deals in Southeast Asian markets, the organization said.

Lotte Chemical has contributed 300 billion won (US$276 million) in growing the polyethylene production facility in Malaysia since 2015 and finished the extension venture in August, the organization said in an announcement.

The Lotte Chemical Titan Holding Berhad plant now has a manufacturing limit of 810,000 tons of polyethylene, up 13 percent from the past limit of 720,000 tons, it said.

Lotte Chemicalclaims a 74.87-percent stake in the plant which for the most part delivers polyethylene, the most widely recognized of plastic items. Lotte Property and Development holds a 31.27-percent stake in Lotte Chemical. The organizations are affiliates of Lotte Group, a retail-to-construction aggregate.

Lotte Chemical intends to extend its manufacturing facilities in South Korea and the United States one year from now to have a consolidated polyethylene yield limit of 4.5 million tons globally, up from 3.3 million tons it is forecasting for the finish of 2017, the announcement said.

December 19, 2017

Vietnam spends $5 million daily on chemical imports

A GDC report showed that in 2016 alone, Vietnam imported $1.8 billion worth of chemicals, including $1.02 billion worth of products to make other compounds. This means that Vietnam spent VND112 billion daily to import chemicals.

The imports were mostly from China, while imports from countries with developed chemical industries such as India, the US, Canada, Israel, Japan and South Korea were modest.

According to Ngo Tri Long, there are three reasons for Vietnam to import chemicals from China. First, Vietnam has high demand for chemicals, but it still cannot produce chemicals domestically. Second, Vietnamese enterprises prefer importing chemicals from China to other countries because Chinese products are cheaper. Third, Vietnam, like other countries neighboring China, want to import chemicals across the border gates instead of through official channels in order to avoid tax.

Le Cao Doan from the Central Economics Institute has also expressed concern about imports from China, especially in the context of Vietnam’s high trade deficit and the risks of relying on Chinese imports.

The high imports from China are problems to many countries including Vietnam, which imports low-quality and dirty products.

“If Vietnam continues importing chemicals from China, it will become the place containing low-quality products and relying on Chinese imports,” he said.

Doan said that Vietnam is facing two big problems.

If continuing to rely on China, the Vietnam economy would lag behind, because the economy would be based on industrial production, similar to what China once experienced in the past. In addition, Vietnam would see the damage to the environment and the platform for development.

What does Vinachem do?

Vinachem, or the Vietnam Chemicals Group, is known as the largest domestic chemicals producer which regulates big fertilizer and chemical factories in Vietnam.

However, the big factories put under Vinachem’s management are incurring huge losses of trillions of dong.

Meanwhile, Vu Dinh Duy, a member of Vinachem’s board of directors, has left Vietnam for medical services and has been unreachable for many months.

In the latest news, Vinachem has set up a steering committee to solve existing problems at fertilizer plants which are incurring big losses.

Besides the chemicals companies in which the state holds the controlling stakes, Vietnam also has many privately run companies in the field.

However, an analyst said domestic chemical output remains modest and Vietnam still has to rely on imports.

February 12, 2017

Azelis announces Strategic Appointments

Azelis, a leading global speciality chemicals distributor headquartered in Luxembourg, announces strategic organisational changes, including Asia, and a new appointment to the Board of Directors, to position the Group for further success.

Laurent Nataf is appointed CEO and President Asia Pacific, effective 1st August, and will be based in Singapore. Nataf was appointed Group Chief Operating Officer in 2012 and has been a member of Azelis’ Executive Committee. He has held key positions during his service with Azelis, including Business Director for Industrial Chemicals and Group Business Development Director.

Asia represents a significant growth opportunity for Azelis. Following a rapid growth trajectory in China and Japan in particular, the team in the region will be enhanced in order to further exploit the potential and accelerate development, serving better Azelis’ partners.

Supported by investors APAX and following the acquisition and successful integration of Azelis Americas, the former Koda Distribution Group, Azelis now has a unique global footprint and is geared for the next phase of growth and expansion.

Azelis currently has operations in Australia, China, Hong Kong, India, Japan, Malaysia, New Zealand, Singapore, Thailand and Vietnam.

The second key appointment is Anna Bertona, currently Chief Strategy and Principal Officer, who will assume the role of Chief Operating Officer EMEA, also effective 1st August, to steer Azelis’ market teams in the region and with a particular focus on Azelis principal development activities. Bertona will remain based in Antwerp, Belgium.

The Board is also pleased to welcome Thijs Bakker as Chief Financial Officer. Bakker will join Azelis in September 2016 following the retirement of Martin Hollenhorst in August. Bringing a wealth of experience in the finance and the chemical industry, Bakker has worked for over 15 years for AkzoNobel in various finance roles in the Netherlands, US and across Asia Pacific. In his most recent assignment Bakker was Finance Director Marine & Protective Coatings at AkzoNobel, based in Singapore. He will be relocating to Antwerp, Belgium for his role.

Dr. Hans Joachim Muller, Azelis Chief Executive Officer, said: “These are significant developments for Azelis; our new appointment and organisational changes within the Executive Committee in Asia, EMEA and at the HQ level will enable us to maximise our growth opportunities.”

In parallel, the Azelis Board of Directors will be strengthened with the appointment of Michael J Roney. Roney was formerly Chief Executive Officer of Bunzl, the international distribution and outsourcing group, listed on the London Stock Exchange FTSE 100 index, with operations spanning 29 countries and 4 continents.

He retired from Bunzl earlier this year, having served as CEO since 2005 and prior to that as non-executive director. Under Roney’s leadership of more than 10 years, Bunzl moved into the FTSE 100, made more than 100 acquisitions and had a compound annual TSR of 17%. The wealth of experience Roney gained at Bunzl and also in other international senior management positions and non-executive directorships, will provide excellent support to Azelis in setting the strategic direction for the business.

Commenting on the appointment of Michael Roney to the Board of Directors, Dr. Muller added: “We will benefit from Michael’s expertise and proven track record in distribution, drawing upon his extensive experience of expanding into new markets”.

These positive developments will support Azelis as it looks to create value and expand further upon its leading position in speciality chemicals and innovative ingredients.

July 27, 2016

South Korea’s Lotte Chemical makes $3.1bn counter bid for Axiall

The two companies last year formed a joint venture to build an ethylene cracker plant together in the US, which is due to start production in 2018.

Lotte declined to reveal the exact terms of its offer, but analysts said the bid would top Westlake’s $3.1bn approach. The counter offer could prompt Westlake to raise its bid after Axiall, a maker of polyethylene products, rejected the approach in April, the analysts added.

“Lotte Chemical will be seen as a white knight for Axiall,” Park Young-hoon, an analyst at LIG Investment & Securities, told Reuters.

If successful, Lotte Chemical would use the acquisition of Atlanta-based Axiall to diversify its product portfolio and secure a foothold in the US.

Axiall said it has been in talks with several potential buyers after its rejection of the first approach prompted Westlake to launch a proxy fight to oust Axiall’s board.

However, investors were unimpressed by Tuesday’s counter-offer, driving Lotte Chemical shares down 3.5 per cent to Won260,500 — their lowest in more than four months — while the Kospi benchmark index closed up 1.3 per cent.

“The deal could be positive for Lotte in terms of securing a stepping stone in the US, but its shares were weighed down by concerns that the acquisition price could be much higher than expected,” said Lee Ji-Yeon, analyst at IBK Securities.

The deal would be Lotte Chemical’s largest overseas acquisition. The company, formerly named Honam Petrochemical, took over Malaysia’s Titan Chemicals for Won1.5tn in 2010.

South Korean chemicals makers are trying build scale to compete better with lower-cost Chinese rivals, with Lotte Chemical buying Samsung Group’s chemicals business for $2.5bn last year.

South Korean petrochemical companies posted record profits last year as lower oil prices drove down material costs. Lotte Chemical reported a Won990.7bn net profit in 2015 on sales of Won11.7tn. The company said it could afford the cross-border deal, with its annual cash flow reaching $2bn.

Almost devoid of hydrocarbon deposits, South Korea relies on oil imports but is also a big exporter of petroleum and petrochemical products. More than half of its processed output goes to markets including China, Japan and the US.

Separately, South Korea’s Hanwha Chemical said on Tuesday its Hanwha Advanced Materials unit had submitted a letter of intent to buy US automotive materials supplier Continental Structural Plastics. The group declined to give the details of the offer but the Maeil Business Newspaper said the deal could fetch $600m.

Axiall’s New York-traded shares, which have lost one-third of their value over the past year, were down 2.5 per cent on Monday at $23.30, before news of Lotte’s approach was made public.

June 9, 2016

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