SEOUL -- DL Chemical presented a goal to establish itself as a global player in the bio-chemical industry by acquiring 100 percent of U.S. chemical company Kraton for 1.89 trillion won ($1.6 billion). The South Korean company vowed to actively localize core materials by utilizing patents held by the U.S. company.
DL Chemical, which was spun off from what used to be Daelim Industrial, said that its board has approved the proposed acquisition of Kraton to lay the foundation for becoming a global petrochemical leader through the diversification of its business portfolio. Kraton is a Houston-based producer of specialty polymers and bio-based products from pine wood pulping co-products.
"With this acquisition, we will actively expand investment in growing Asian markets, along with the localization of core technologies in global supply chains monopolized by a small number of countries with advanced technologies," DL Chemical vice chairman Kim Sang-woo said in a statement on September 28.
DL Chemical highlighted Kraton's styrene block copolymer (SBC), a class of thermoplastic elastomers that process like plastic but behaves like rubber, as a high value-added product among synthetic rubbers, saying SBC is attracting attention as a high-tech material used for sanitary adhesives, medical supplies, automobile interior materials, and 5G cables.
Kraton with its biochemical production capacity standing at 700,000 tons per year produces eco-friendly fuels, highly functional tire materials, and eco-friendly adhesives. DL Chemical said it would raise funds using cash holdings and borrowing to complete the acquisition of Kraton within the first half of 2022.
DL Chemical has strengthened its specialty product lineup. In a $530 million deal in 2020, the petrochemical company acquired Cariflex, a leading manufacturer of synthetic rubber materials for medical purposes, from Kraton. The expansion of the Cariflex plant in Brazil has been completed.
In June 2021, DL Chemical partnered with EXtac, a polymer producer based in Texas, to set up a hot melt glue joint venture in the southern industrial port city of Yeosu. Production is to begin in the first half of 2023. Hot melt glue is an adhesive that can be melted by heat and is widely used to assemble sanitary products such as diapers and sanitary pads and various industrial products such as automobiles.
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