On August 17, Korea Economic Daily reported, citing anonymous government officials, that Lotte Chemical has disclosed to its creditors and the Ministry of Trade, Industry and Energy a plan to sell overseas basic chemicals assets, involving facilities in Malaysia, Indonesia, and the United States. The company is currently assessing market conditions and engaging with potential buyers. The sale plan, previously suspended due to Middle East tensions, has now been restarted.

Malaysian Assets: Lotte Chemical Titan as Core Sale Target

Lotte Chemical acquired Lotte Chemical Titan in 2010 for approximately 1.5 trillion won and currently holds a 74.7% stake. The subsidiary has posted losses for 17 consecutive quarters, recognized about 1 trillion won in asset impairment losses in Q4 2025, and reported the largest quarterly and full-year losses in the company's history in February 2026. The losses mainly stem from shrinking margins on basic petrochemical products, with the spread between high-density polyethylene and naphtha under persistent pressure, compounded by increased supply in the Southeast Asian market, weighing on plant profitability. Public information shows that Lotte Chemical has had prior failures in overseas asset disposals – its Pakistan PTA asset sale failed twice, and its Malaysian synthetic rubber joint venture was liquidated in 2024.

Indonesian Assets: Negotiations to Bring in Local Sovereign Fund as Shareholder

Lotte Chemical Indonesia’s LCI project represents a total investment of about 5.7 trillion won. Its Serang integrated petrochemical complex officially commenced production in May 2025, equipped with a mixed-feed cracker and polypropylene production capacity. The project has remained loss-making since start-up, and in June 2026 the Indonesian subsidiary received a $790 million loan from its parent company. Lotte Chemical is currently in talks with Indonesia's sovereign wealth fund Danantara to sell a 25%–30% minority stake in LCI, with the transaction valued at approximately $1.7 billion. LCI's current shareholding structure is 51% held by Lotte Chemical Titan, 24% by Lotte Chemical, and 25% by a Korean consortium. The negotiations were previously delayed in April 2026 due to Middle East tensions, and as of now no binding agreement has been signed; the final stake percentage and transaction valuation have yet to be finalized.

U.S. Assets: Continuation of Previous Equity Sale Plan

The disposal of assets from the company's Louisiana facility is a continuation of the sale plan announced by Lotte Chemical in October 2024. The plant, which started production in 2019, primarily produces ethylene glycol, with integrated ethylene and ethylene glycol capacities. The original plan was to sell a 40% stake in the subsidiary for about 660 billion won. In July 2026, the plant experienced a shutdown of about three weeks due to a critical equipment failure.

Company Financial Status

From 2022 to 2025, Lotte Chemical recorded operating losses for four consecutive years, with cumulative losses in its basic chemicals business nearing 3 trillion won. In 2025, the company posted an operating loss of 943.1 billion won, the highest since its founding, and its full-year net loss widened to 2.4762 trillion won. Debt levels have continued to rise – consolidated net debt stood at about 6.7 trillion won at end-2025, rising to 8.06 trillion won at end-Q1 2026, with the net debt-to-total capital ratio increasing from 38% to 43%. In June 2026, a Korean rating agency downgraded its credit rating outlook from "stable" to "negative." Over the past two years, Lotte Chemical has raised approximately 1.7 trillion won through disposals of non-core assets.

Business Restructuring Plan

Lotte Chemical has set a 2030 business restructuring target, planning to reduce the proportion of basic chemicals operations while increasing the share of advanced materials, fine chemicals, battery materials, and hydrogen energy businesses. At the current stage, it is shrinking its basic chemicals business through shutdowns, mergers, and sales, extending the scope of asset disposals from the domestic Korean market to Southeast Asia and the United States.