Lotte Chemical, the petrochemicals unit of South Korea’s Lotte Group, said Tuesday that it has made an offer to buy U.S.-based chemicals producer Axiall Corp. with aims to expand its business portfolio and strengthen its footing in North America.

The company said it submitted its bid to take over Axiall Corp. last Saturday. No further details were disclosed, including its offering price.


Axiall Corp. is an Atlanta-based chemicals firm that specializes in producing integrated chlorovinyls and vinyl-based building and home improvement products. It generated about 4 trillion won ($3.44 billion) in sales last year, according to Lotte Chemical.

Lotte Chemical’s buyout offer comes as Axiall rejected Westlake Chemical Corp.’s proposal to buy the firm for $3.1 billion won in April, asserting that the firm was undervalued.

If successful, the acquisition would enable Lotte Chemical to diversify its business portfolio beyond olefins and aromatics production to include other specialty chemicals like chlorovinyls, the Korean chemicals firm stated.

The takeover would also drive up Lotte Chemical’s annual profit to beyond 21 trillion won, making it the world’s 12th largest chemicals company and a “global integrated chemicals producer,” the firm said.

Lotte Chemical further expects the deal to synergize with its ongoing joint project with Axiall to build a shale gas-based ethane cracking plant in the U.S., scheduled to begin production in 2018.

Lotte Chemical, which currently holds more than 2 trillion won in cash assets, said it is reviewing diverse ways to finance the acquisition including cash.

By Sohn Ji-young (jys@heraldcorp.com)