Indorama Ventures PCL (IVL), the leading intermediate petrochemical producer listed on the Stock Exchange of Thailand (SET), will be acquiring a 94.91 per cent stake in Bangkok Polyester PCL from Bangkok Cable Company for an undisclosed amount.
Bangkok Polyester is a polyethylene terephthalate (PET) polymers producer with an annual production capacity of 105,000 tonnes in Rayong province. The transaction is expected to be completed in the next quarter, according to its statement.
IVL’s PET segment represents 50 per cent of the company’s overall production. The segment saw production increase from 2.9 million tonnes in 2013 to 3.1 million tonnes in 2014, a growth of 7 per cent year on year.
The acquisition of Bangkok Polyester is in line with its strategies to grow aggressively and increase its market share by acquiring or taking over other plants.
Earlier, chief executive Aloke Lohia said that it set the budget of $2.2 billion for investing during 2015-17. Of that, $1.9 billion will be for growth CAPEX and the remaining $300 million will be used for maintenance.
In it’s is three-year plan, around $1.5 billion will be spent in 2015 on acquiring the businesses. In the first quarter, it has announced the investment of around $600 million, while other projects worth $900 million are under the negotiation.
After all its acquisition this year, it expects to boost total production capacity by 25 per cent.
The company reported total earnings of 5.1 billion baht ($164.51 billion) in 2014, rising 146 per cent over 2013. Its earnings after extraordinary and non-cash items last year amounted to 1.48 billion baht ($47.74 million), up 12 per cent from the previous year.
It has targeted to maintain a net debt to equity ratio of around 1.0 time in the long term as against 0.83 times as of the end of 2014.
IVL stock was close at 24.80 baht on Friday, up 1.64 per cent from its previous close.