Lotte Chemical Pakistan Limited (LCPL) is set to acquire Engro Corporation Limited’s 56.19% stake in Engro Polymer & Chemicals Limited (EPCL) for Rs 19.7 billion, in a landmark deal aimed to reshape Pakistan’s petrochemical landscape.

 

Under the Share Purchase Agreement signed by the companies, LCPL will acquire the stake at Rs 38.6 per share. Following completion, LCPL will launch a mandatory public tender offer for EPCL’s remaining shareholders, subject to applicable laws and regulations.

 

LCPL also plans to merge EPCL into its business after securing the necessary regulatory approvals, creating what the company describes as a scaled, diversified and globally competitive petrochemical platform.

 

The transaction brings together two strategically important assets: Pakistan’s sole producer of Purified Terephthalic Acid (PTA) and the country’s only integrated Chlor-Vinyl complex. The combined portfolio will span PTA, PVC, Caustic Soda, Hydrogen Peroxide, Sodium Hypochlorite (HYPO), Hydrochloric Acid (HCL), Acetic Acid and other value-added chemical products.

 

The deal is expected to unlock synergies across energy, operations, procurement and supply chains, while allowing the combined business to leverage shared technical capabilities and improve manufacturing-asset utilization.

 

A key part of the value proposition is EPCL’s potential shift away from costly captive gas-based power generation toward more economical grid electricity, alongside renewable energy initiatives. LCPL said the move is expected to improve EPCL’s long-term competitiveness while supporting Pakistan’s sustainability goals.

 

The acquisition would also reduce LCPL’s reliance on a single-product business model. PTA and PVC have historically moved through different market cycles, potentially reducing earnings volatility and creating a more balanced earnings profile for the combined company.

 

With greater scale, a stronger balance sheet and a broader product portfolio, the enlarged business would be positioned to pursue brownfield and greenfield expansion opportunities as Pakistan’s industrial base grows.

 

The companies also expect the transaction to deliver wider economic benefits by strengthening Pakistan’s petrochemical value chain, reducing import dependence, supporting downstream industries, attracting future foreign investment and creating direct and indirect employment.

 

Chairman of Lotte Chemical Pakistan Limited, Imtiaz Ahmed, said: The acquisition of EPCL represents a transformational milestone in LCPL’s history and demonstrates our unwavering confidence in Pakistan’s economic future. This transaction is not merely an acquisition – it is a strategic investment in Pakistan’s industrial future.

 

Chief Executive Officer of Lotte Chemical Pakistan Limited, Adnan Afridi added: This combination creates a stronger platform for sustainable growth, operational excellence, and innovation. The identified synergies, coupled with the complementary strengths of both businesses, will enhance our competitiveness while enabling us to deliver greater value to our customers and stakeholders. 

 

'We remain committed to investing in our people, digital transformation, technology, sustainability, operational excellence, and future expansion projects that will strengthen Pakistan’s manufacturing base and contribute to long-term economic development.

 

Chief Executive Officer of Engro Corporation, Ahsan Zafar Syed, remarked: Engro is pleased with the role we have played in EPCL’s journey since 1997; we believe the proposed transaction would allow us to realize the value and learnings created through that journey while positioning the business to benefit from the synergies of a broader petrochemicals platform. 

 

"At the same time, the transaction would enhance our ability to pursue new investment opportunities in line with our responsibility to continually assess where capital can create the greatest value."

 

If completed, the acquisition would mark a major consolidation in Pakistan’s petrochemical sector and give LCPL a significantly broader manufacturing and product footprint.