To maximize the company's corporate value with a strengthened market power and competitiveness and improve the financial structure, the board of directors at LG Chem has decided to merge with LG Petrochem on November 1st. The swap ratio of the merger is 1:0.48.
The completion of the merger will catapult LG as second largest producer of ethylene in Korea and fifth largest in Asia. Annual ethylene production capacity of the merged entity will be 1.66 mln tons : 0.9 mln tons from LG Petrochem and 0.76 mln tons from LG Chem.
LG Chem also expects the merger to enhance its competitiveness by strengthening the negotiating power for purchase of raw materials like naphtha, securing more funds and establishing an integrated management system between production and sale and R&D. The merger will enhance the ability of the company to pursue M&As and launch new businesses with a strengthened investment power. Along with these, it would improve the financial structure with a lowered debt ratio of around 80% and secure funds more easily.
09-Jul-07 
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