13 June 2005 09:03 [Source: ICIS news]
SINGAPORE (CNI)--Thai Petrochemical Industry (TPI) is looking for a buyer for its 30% stake in TPI Polene (TPIPL), but it could retain the cement-making subsidiary’s low-density polyethylene (ldPE) plant within the group, a senior company official told CNI on Monday.
TPI has a 30% stake in TPIPL, and is looking to divest its stake for some $250m in an auction around mid-July. Details of the auction, and whether the 158,000 tonne/year ldPE unit would remain with TPIPL, are expected in the next two weeks, said the official.
“The details are being worked out, we know that TPIPL must be divested to get money to reduce TPI’s debts. It is possible that the PE plant could remain with TPI, which is a petrochemical company. TPIPL's attraction to potential buyers is its cement business. We will know more on the sale in the coming weeks,” said the official.
The sale is part of the rehabilitation of TPI, which collapsed under debts of around $2.7bn (Euro2.23bn) after the 1997 financial crisis. Thailand’s Ministry of Finance (MoF), TPI’s administrator, agreed to sell a 61.5% stake in the company to several government-linked companies including national oil, gas and petrochemical major PTT Pcl, in early June.
TPI’s founder Prachai Leophirathana is trying to trump that deal with a rival bid, supported by Hong Kong-listed Citic Holdings and Resources. But Thailand’s Central Bankruptcy Court will decide at end-June whether this bid will go through, and analysts told CNI last week that it was unlikely to succeed.
TPIPL is Thailand’s third biggest cement producer. In the past, global cement makers such as Mexico's CEMEX and Switzerland’s Holcim, through its subsidiary Siam City Cement, have expressed an interest in TPIPL. Neither bid went through.
“We believe that international companies might be interested in TPIPL, given that the demand for cement is likely to grow subtantially in the coming years in Thailand and the region," he said.
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