29 August 17 The Business Times by ANDREA SOH
EXXONMOBIL has completed its acquisition of Jurong Aromatics Corporation's (JAC) Jurong Island plant, one of the largest aromatics facilities in the world.
The deal was first announced in May this year. The acquisition sum was not disclosed, but industry observers had estimated the purchase price to be as high as US$1.7 billion; bids from the South Korean companies were said to be in the region of US$1 billion.
JAC's facility has an ethylene production capacity of 1.9 million tonnes a year. The acquisition will boost ExxonMobil's Singapore aromatics production to over 3.5 million tonnes each year, including 1.8 million tonnes of paraxylene, and add 65,000 barrels a day of transportation fuels capacity.
ExxonMobil Asia-Pacific's chairman and managing director Gan Seow Kee said that the integration of the aromatics plant with the firm's existing manufacturing facility will help it to serve its customers better in key Asian growth markets, and further establish Singapore as a hub for global trade and economic progress.
"We have rehired a majority of the qualified employees from JAC," he added. "Their knowledge and expertise will help to ensure its continued safe and reliable operations."
Industry observers have said that the deal is a win-win for both parties. ExxonMobil can now access additional export logistics capacity, while its integrated refining complex offers JAC's plant opportunities to use and upgrade refining streams that JAC itself would not have been able to access, alleviating margin pressures.
Before it went into receivership, JAC's largest shareholders were South Korean refiner SK Energy (30 per cent) and Chinese polyester maker Jiangsu Sanfangxiang Industrial Group (25 per cent).
Other significant owners included entrepreneur Vijay Goradia of Houston-based chemicals firm Vinmar Group (10.5 per cent), Swiss trader Glencore (10 per cent) and Indonesia's Sridjaja family (9.5 per cent).
Thai KK Industry, EDB Investments and Indian multinational conglomerate Essar Group rounded up the rest of the equity interest.