The merger of Thailand's two major petrochemical firms, National Petrochemical PLC (NPC) and Bangkok Polyethylene PLC (BPE), has been canceled by disagreement on share pricing.
Also, state-owned Petroleum Authority of Thailand (PTT) posted a profit before government sharing of 13 billion baht ($302.32 million) last year, down nearly 5% from 1999.
PTT attributed its earnings decline to shrinking oil sales. It has monopoly in the natural gas business, which contributed 13.9 billion baht of profit.
NPC said the deal to buy BPE, the kingdom's largest producer of high-density polyethylene, collapsed because the two companies disagreed on the value of BPE, management styles, production techniques, and layoffs of BPE staff.
Last year, NPC proposed to buy BPE for 1.7 billion baht ($39.53 million US), equal to BPE's registered capital (OGJ Online, Aug 17, 2000).
NPC executives now say they will invest $150 million to build their own polyethylene plant. NPC makes 401,000 tonnes/year of ethylene and 27,000-46,800 tonnes/year of propylene at its plant in Rayong.
It is one of the three upstream petrochemical firms owned by PTT. The other two, Thai Olefins and Aromatics (Thailand) have large debt burdens.
BPE is owned 40.23% by Bangkok Bank, which has wanted to exit the petrochemical business.
