PETALING JAYA: Titan Chemicals Corp Bhd announced yesterday the completion of its proposed acquisition of 100% of PT Petrokimia Nusantara Interindo (PT PENI) via its subsidiary, Titan Petchem (M) Sdn Bhd, making Titan Chemicals the largest polyolefins producer in South-East Asia.
PT PENI is the largest Indonesian polyethylene producer and owns a petrochemical complex in Cilegon, Banten Province, with three linear low-density and high-density polyethylene lines with a capacity of 450 thousand tonnes per annum (KTA).
In a statement to Bursa Malaysia, managing director Donald M. Condon Jr said: “The acquisition of PT PENI will give Titan Chemicals additional manufacturing capability and position it as the largest polyolefins producer in South-East Asia.”
Condon said the acquisition costing about RM75mil fitted into Titan Chemicals' business strategy and would result in many synergies.
“We can bring integrated solutions to a non-integrated operation,” he said, adding that more importantly, the purchase opened the door to a huge Indonesian domestic market of over 242 million people with a growing appetite for polymer-based products.
Condon said the purchase of PT PENI would help increase the company's polyolefins production capacity by 50%.
“It would cost us a lot of money and time, at least over five years, to build a complex of this scale and ability,” he said.
He also said the acquisition was modest in terms of expenditure and would save time, a major advantage to any petrochemical player like Titan Chemicals.
Moving forward, Condon said PT PENI would be re-branded to PT TiTan Petrokimia Nusantara, headed by president director Jay Diau.
Jay said the priority was to ensure adequate feedstock supply to the company's newly acquired plant from a combination of internal and external resources.
“We believe two lines are ready to start operating and this will bring us 125 KTA and 200 KTA respectively. We aim to be operational within eight weeks,” he added.
Jay said the Indonesian operations would be tapping the Malaysian business for the transfer of skills and expertise.
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