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Lotte Chemical, HD Hyundai Chemical submit Korea's first voluntary restructuring plan for gov't approval

Published: 26 Nov. 2025, 17:20

A view of Lotte Chemical’s Daesan plant [LOTTE CHEMICAL]

Korea’s first voluntary restructuring plan in the oversupplied petrochemical sector is awaiting approval from the Ministry of Trade, Industry and Energy, with Lotte Chemical and HD Hyundai Chemical moving to reduce naphtha cracker capacity (NCC) at their complexes in Daesan, South Chungcheong.

Lotte Chemical said on Wednesday that it submitted the request under the Special Act on the Corporate Revitalization, known as the “One-shot Act.”

The law eases regulations and streamlines procedures to allow companies to voluntarily reorganize their businesses, from mergers and acquisitions to spin-offs, stock swaps and more. Introduced in 2016, it aims to help companies suffering from oversupply adjust their business portfolios and regain competitiveness.

Under the restructuring plan, Lotte Chemical will first spin off its Daesan plant. The newly created entity will then merge with HD Hyundai Chemical, a joint venture of which 60 percent is owned by HD Hyundai Oilbank and 40 percent by Lotte Chemical.

The two companies aim to rationalize their NCC facilities and unify operations through the merger. Lotte Chemical currently has an annual NCC production capacity of 1.1 million tons, and HD Hyundai Chemical has 850,000 tons. Lotte Chemical said it aims to “contribute to strengthening competitiveness in the petrochemical industry while simultaneously shifting toward high-value and environmentally friendly business structures.”

The companies said they will continue discussions to determine the optimal operational framework once government approval is granted.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY KIM SU-MIN [[email protected]]