SK Lubricants acquires 49% stake in Vietnam’s Mekong Petrochem

The logo of SK Innovation is seen in front of its headquarters in Seoul, South Korea, February 3, 2017. REUTERS/Kim Hong-Ji/File Photo

SK Lubricants, a subsidiary of South Korea’s SK Innovation, has acquired a 49 per cent stake in Mekong Petrochemical JSC (Mekong Petrochem) for 50 billion won ($42.1 million).

The deal, which marks the SK Lubricants’ first overseas investment, is also part of its plan to expand in the Southeast Asia region.

Established in 1996, Mekong Petrochem is one of the top petrochemical companies in Vietnam and Southeast Asia.

The company is said to hold 6.3 per cent share in the Vietnamese lubricants market as of 2018.

Under the agreement, Mekong will distribute SK Lubricants’ products and develop base oil into products. Meanwhile, SK Lubricants said it has established an end-to-end value chain covering production, storage and retail across Vietnam.

The two sides agreed to replace Mekong’s old facilities and strengthen the sales network across the ASEAN region.

SK Lubricants is SK Innovation’s wholly-owned subsidiary for the base oil and lubricant business. It is the third-largest in the global base oil market in terms of market share while it holds 39.3 per cent of market share in the premium base oil (Group III).

The company developed a Group III base oil, YUBASE, through its own technology in 1995. Since then, it has produced and sold premium base oil and lubricants in 50 countries around the world.

Last year, it planned an initial public offering (IPO) worth up to 1.56 trillion won ($1.48 billion).

SK is one of the largest South Korean chaebols, with businesses across energy, chemicals, telecommunications, semiconductors, logistics and service sectors.

Most recently, Korea’s National Pension Service (NPS) and business juggernaut SK Group have reportedly joined forces to form a 1 trillion won ($860 million) fund to invest in Vietnam.

Earlier, SK Group picked up a 6.1 per cent stake in Vietnam’s behemothVingroup for $1 billion.

Singapore Reporter/s

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Following vacancies can be applied for (only in Singapore).   

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.