Titan Chemicals Corp.
BHD. to acquire PT PENI, Indonesia's largest polyethylene
producer through its subsidiary, Titan Petchem(M) SDN BHD
http://www.titangroup.com/MediaRoom/PRv7.pdf
Titan Petchem (M) Sdn
Bhd, a wholly-owned subsidiary of Titan Chemicals Corp. Bhd. has
entered into a conditional sale and purchase
agreement with Golden Park Limited-Indika Group to acquire 100%
of the equity of Chemical Brothers Limited, 100% equity owner of
PT Petrokimia Nusantara Interindo ("PT PENI"). PT PENI,
the largest
Indonesian polyethylene producer, is the owner of a petrochemical
complex in Cilegon, Banten Province, comprising 3 Linear Low
Density Polyethylene ("LLDPE")/High Density
Polyethylene("HDPE") lines with a nameplate capacity of
450,000
MTA. The
complex was built by British Petroleum("BP") and the
plant utilizes BP's renowned Innovene Technology.
At the signing ceremony of the agreement graced by Indonesia
Minister of Industry, Bapak Fahmi Idris, Malaysian Ambassador,
Dato' Zainai Abidin Mahamad Zain and Chairman of Indonesia
Investment Coordinating Board, Bapak Muhammad Lutfi, Titan
Chemicals' Managing Director, Mr. Donald M. Condon Jr. said,
"The proposed acquisition is a significant milestone in our
journey as a newly listed company, as it will open doors to a
host of opportunities.
"Our current production capacity is sold out, our company is
strong and we shift now to concentrating on profitable growth -
the proposed acquisition of PT PENI is our first significant step
in that effort. This acquisition will increase the polyolefins
capacity of Titan Chemicals by close to 50% and make it the
largest polyolefins producer in South East Asia.
"With a population of 242 million people, Indonesia has per
capita polylofins consumption of 6 kg/annum compared with 46
kg/annum in Malaysia, and 200 kg/annum in developed countries
like the USA and Germany. The prospects for significant demand
growth for polyethylene is therefore promising."
The proposed acquisition will provide Titan Chemicals with
manufacturing capabilities and an opportunity to position itself
in a large domestic market in a second ASEAN country outside of
Malaysia.
It is expected that Titan Chemicals will replicate its business
strategies which has been tested and proven in the Malaysian
market. the Malaysian fabrication sector has quadrupled in scale
since the inception of Titan Chemicals as a result of excellent
product quality, reliability of supply, strong technical support
and nurturing of the fabrication sector growth - a reflection of
the symbiotic relationship between the downstream fabrication
sector and the upstream petrochemicals industry.
The proposed acquisition is expected to improve Titan Chemicals'
operability and reduce its production costs. Further the proposed
acquisition will reflect the objectives of the industrial
complementation strategies between ASEAN countries.
By way of the proposed acquisition, Titan Chemicals will be able
to offer integrated solutions to a non-integrated producer.
Besides being able to supply ethylene feedstocks to PT PENI from
its Pasir Gudang facility, Titan Chemicals also will be able via
its procurement network to supply feedstock chemicals and
catalysts to PT PENI. Titan Chemicals will also be able to extend
to PT PENI, the services of its Malaysian and International
Marketing Network and Plastics technical Centre for Research
& Development and the technical expertise of its Malaysian
employees, many of whom have over a decade of experience in
operating and maintaining petrochemical facilities.
For the nine months ended September this year, our revenue stands
at close to USF 1 billion (RM3.4 billion) with earnings after tax
of USD 90.5 million (RM 342 million).
About Titan Chemicals Corp. Bhd
Titan Chemicals was the first, and is the largest, integrated
olefins and polyolefins producer in Malaysia and is the second
largest polyolefins producer in Southeast Asia. Titan Chemicals
presently operates eight plants on two integrated sites in Pasir
Gudang and Tanjung Langsat in Johor, which are connected by a
12-km network of pipelines.
Titan Chemicals operates two principal business units, namely
polyolefins, and olefins and aromatics. It has annual olefins
production capacity of over 1,000,000 metric tonnes, and polymer
capacity of more than 900,000 metric tonnes. These products are
fundamental to the production of many diverse consumer and
industrial products including flexible and rigid packaging,
fibers and automotive parts. In addition Titan Chemicals has an
aromatics plant that produces 200,000 metric tonnes of benzene
and toluene. Benzene is used o produce styrene. phenol and
cyclohexane which are used in the production of nylon, plastics
and rubber. Toluene is used as an octane enhancer in gasoline as
a chemical feedstock for benzene and/or paraxylene production as
a solvent in paints.
December 22, 2005
Titan Chemicals To
Expand Operation In Indonesia
http://www.bernama.com/bernama/v3/news_business.php?id=172381
Titan Chemicals Corp Bhd,
Malaysia's largest integrated producer of olefins and
polyolefins, aims to expand its operation in Indonesia following
its acquisition of PT Petrokimia Nusantara Interindo (PT Peni).
Titan, through its
wholly-owned subsidiary, Titan Petchem (M) Sdn Bhd Thursday
signed a conditional sale and purchase agreement with Golden Park
Limited-Indika Group, to acquire 100 percent of the equity of
Chemical Brothers Ltd, a 100 percent equity owner of PT
Petrokimia Nusantara Interindo (PT Peni).
Speaking to
reporters here today, Titan Chemicals' managing director Donald
M. Condon Jr said the acquisition, expected to be completed by
end of March, would see Titan increasing the current capacity of
PT Peni, by 20 to 30 percent from the current 450,000 metric
tonnes of polyethylene per annum.
"Our target
for next year are the large consuming markets and their domestic
markets. Indonesia is also in the list. The big issue now is the
growth of plastic usage for next year which will determine the
growth for the industry," he said after the signing
ceremony.
The ceremony was
witnessed by Indonesian Industry Minister Fahmi Idris and
Malaysian Ambassador to Indonesia Datuk Zainal Abidin Zain.
Currently,
Indonesia which has a population of 242 million people, has a per
capita polyolefins consumption of six kg per person per annum,
compared with Malaysia's 46 kg per person per annum, Condon said.
PT Peni which owns
a 47-hectare of petrochemical complex in Cilegon, Bantem
Province, has three production lines of linear low density
polyethylene (LLDPE)/high density polyethylene (HDPE). Current
plans for its include the building of a cracker.
Titan currently
runs a massive RM6 billion petrochemical complex located in Pasir
Gudang and Tanjung Langsat, comprising two Naptha crackers which
produce among others, ethylene and propylene, the two main
feedstocks for its five polyolefins plant.
Ethylene and
propylene are the primary building blocks in the petrochemicals
industry, used to produce diverse applications in the consumer
and manufacturing industries.
For Titan, the
acquisition would increase the polyolefin capacity of the group
by close to 50 percent from the current 945,000 metric tonnes per
annum, making it the largest polyolefin producer in Southeast
Asia, Condon said.
An industry sources
said building of the cracker is expected to cost about US$1
billion to US$4 billion.
Titan, which is
currently the second largest polyolefin producer in Southeast
Asia in capacity terms, is expected to become the largest in
Southeast Asia with the acquisition of PT Peni.
Condon said its
current production capacity was sold out, and with the additional
capacity from PT Peni, it would be able to penetrate the domestic
market here as well as expand its export market.
For now, PT Peni's
production is for local consumption only.
On its performance,
Condon said the group expected to realise earnings from PT Peni
in its financial year ending Dec 31, 2007.
When asked on the
purchase price of the PT Peni, he said it has not been finalised.
He, however, added that it was an attractive investment.
On Wednesday,
sources said that Titan would pay US$23 million (RM87.4 million)
(US$1=RM3.8) for the company, which would be more cheaper when
Indika Group took it over from Beyond Petroleum (BP Plc) and
Mitsui and Sumitomo Corp for US$50 million.
Titan, a joint
venture between government-controlled PNB Equity Resource Corp
and Taiwan's Chao Group International, is Malaysia's largest
maker of olefins and polyolefins, which are materials used to
produce plastics and fibres used in mobile phones and car
dashboards.
2006/3/21 Titan Chemicals
Titan Chemicals
Corp, Bhd. becomes SEA's largest polyolefins producer with
acquisition of PT PENI
Titan Chemicals
Corp, Bhd. announced today that it has completed the acquisition
of 100% of the equity of PT Petrokimia Nusantara Interindo (PT
PENI) via its subsidiary, Titan Petchem (M) Sdn. Bhd. PT PENI,
the largest Indonesian polyethylene producer, is the owner of a
petrochemical complex in Cilegon, Banten Province, comprising 3
Linear Low Density Polyethylene ("LLDPE")/High Density
Polyethylene ("HDPE") lines with a nameplate capacity
of 450 KTA. The three lines utilize the world renowned Innovene
Technology.
At a press
conference marking the completion of the transaction, Titan
Chemical's Managing Director, Mr. Donald M. Condon, Jr said,
"This acquisition will give Titan additional manufacturing
capability and position it as the largest polyolefins producer in
South East Asia. PT PENI fits our business well and there are
many synergies with this acquisition; significantly, we can bring
integrated solutions to a non-integrated operation. More
importantly, it opens the door to a huge Indonesian domestic
market of 242 million people with a growing appetite for
polymer-based products."
Titan Chemicals'
current production capacity is sold out, and the company is
financially strong, thus its management has shifted to
concentrating on profitable growth - the proposed acquisition of
PT PENI is its first significant step in that effort. This
acquisition will increase the polyolefins capacity of Titan
Chemicals by close to 50%. It would generally take an investment
of several hundred million US dollars and 5 years or more to
build a complex of this scale and the ability to add such
capacity to its portfolio at a modest cost both in terms of
expenditure and time is a major advantage to any petrochemical
player like Titan.
Elaborating
further, Mr. Condon said, "Moving forward, the company will
be rebranded PT TITAN Petrokimia Nusantara or PT Titan in short.
Having spent his most recent years at Titan leading international
business development, making forays into China, Vietnam and the
Middle East, Mr. Diau will bring great depth to PT PENI's
marketing capabilities."
It is expected that
Titan Chemicals will replicate its strategies which have been
tested and proven in the Malaysian market. The Malaysian
fabrication sector has quadrupled in scale since the inception of
Titan Chemicals thanks to excellent product quality, reliability
of supply, strong technical support and nurturing of the
fabrication sector growth - a reflection of the symbiotic
relationship between the downstream fabrication sector and the
upstream petrochemicals industry.
On its plans to
become operational, Mr. Jay Diau said, "Our priority is to
ensure adequate feedstock supply from a combination of internal
and external sources. We believe two lines are ready to start up
and this will bring us 125 KTA and 200 KTA respectively. We aim
to be operational within eight weeks."
An added benefit of
the acquisition will be the realization of industrial
complementation objectives within ASEAN as well as support of the
Government's call to develop Malaysia-Indonesia business
relationships. The acquisition is expected to improve Titan's
operability and reduce production cost too.
Besides being able
to supply ethylene feedstocks to PT Titan from its Pasir Ggudang
facility, Titan Chemicals also will be able via its procurement
network to supply feedstock chemicals and catalysts to PT Titan.
Titan Chemicals will also be able to extend to its Indonesian
operations, the services of its Malaysian and International
Marketing Network and Plastics Technical Centre for Research
& Development work and the technical expertise of its
Malaysian staff; many of whom have over a decade of experience in
operation and maintaining similar facilities.
Malaysian Titan Chemicals to test-run butadiene plant in December
Malaysia's Titan
Chemicals expects the building of its butadiene plant in Johor to
reach mechanical completion in late November, with test runs to
begin in December, a source close to the company said Thursday.
As Titan does not produce butadiene derivatives, all of the
plant's output will be sold.
The company inked a five-year contract in March last year to supply butadiene
to South Korea's Kumho Petrochemical, before it broke ground for the
project.
"We look forward to shipping our product to them in the
second half of 2007," Titan managing director Donald M.
Condon said at the time in a company statement.
Titan's local butadiene buyers are likely to be Toray Industries, which has a 220,000 mt/year
acrylonitrile-butadiene-styrene plant near Penang, and BASF
PETRONAS Chemicals, which produces butanediol at Kuantan.
The 100,000
mt/year butadiene plant at Pasir Gudang, Johor, is being built by Taiwanese
engineering and construction firm CTCI Overseas Corporation
Limited.