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SK General Chemicals accelerates transformation to high-value selective materials manufacturer

 Last Update: 2022-08-22
 Source: Internet
 Author: User

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South Korea's SK General Chemicals is ditching ordinary chemicals for a higher-end and more selective enhanced functional polymer business

The board of directors recently approved a spending plan to issue new shares worth 144 million euros ($157 million) to complete the 335 million euro acquisition of the functional polymers business from French chemical company Arkema

Arkema

The latest fundraising will increase the equity capital of its French subsidiary SK Functional Polymer by EUR 144 million to support its acquisition of Arkema's functional polymers business

SK General Chemicals, which announced the plan last October, will buy the functional polymers business of French chemical company Arkema for 335 million euros

"The acquisition will lay the foundation for entering the high value-added packaging business," an official of the company said

While expanding its high-value-added product portfolio, SK General Chemicals has been dealing with low-margin and crowded markets

It sold its heat-resistant polyethylene production subsidiary SK Golden Tide Plastics and specialty chemicals maker Huan Specialty Chemical

The company is aggressively restructuring its business portfolio as competition for the naphtha cracking business, which produces basic materials for the petrochemical industry, is intensifying in South Korea and China due to the influx of new competitors amid low barriers to entry

To improve profitability, SK General Chemicals announced in 2017 that it will grow its packaging and mobility business as its next growth engine
.
The company acquired DowDuPont's ethylene acrylic acid and PVC in 2017 and plans to take over Arkema's functional polymer production to secure packaging technology
.
South Korea relies entirely on imported high-performance polymers, which are mainly used as adhesives for multi-layer packaging
.

The company has also expanded its automotive business after developing highly crystalline polypropylene plastics (HCPP) for automotive interior and exterior parts
.
Eco-friendly HCPP uses 10% less plastic than conventional polypropylene and can help reduce the weight of mid-size cars by up to 10kg
.

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