PTT Global Chemical Public Company Limited (SET: PTTGC or GC) and SCG Chemicals Public Company Limited (SCGC), a subsidiary of The Siam Cement Public Company Limited (SET: SCC) have announced plans to combine their olefins and polyolefins businesses in Thailand to strengthen the Thai petrochemical industry’s competitiveness on the global stage. The partnership will bring together the two companies’ strengths in manufacturing capabilities, feedstock flexibility, high value-added product development, technology and innovation, and global customer and market networks. The aim is to create a larger, stronger business that supports the growth of downstream industries in Thailand while enhancing the industry’s long-term resilience.
The new joint venture will have a combined olefins production capacity of approximately 7.1 million tonnes per year and will rank among the world’s 10 largest polyolefins producers by production capacity, while taking a leading position in ASEAN. The partnership is expected to generate synergies of approximately US$150–200 million per annum, with the full benefits progressively realized within approximately three years.
Mr. Narongsak Jivakanun, Chief Executive Officer of GC, said, “This partnership aims to build on Map Ta Phut’s position as Thailand’s petrochemical industrial base and develop it into a regional petrochemical manufacturing hub. By connecting our manufacturing capabilities with the research and development expertise of both GC and SCGC, we will develop products and solutions that meet the needs of downstream industries. This will support Thai businesses, including SMEs, in adding value to their products and strengthening their competitiveness in both domestic and export markets.”
Mr. Sakchai Patiparnpreechavud, Chief Executive Officer & President of SCGC, said, “We are bringing together the distinct and complementary strengths of the two organizations to create a competitive business capable of sustainable growth. These strengths range from feedstock flexibility and manufacturing capabilities to technology, innovation, and the development of high value-added products that meet the needs of businesses and downstream industries. In terms of production capacity, this combination will help elevate Thailand into a regional petrochemical hub and bring the combined business among the world’s top 10 polyolefins producers, enhancing its capabilities and competitiveness amid the challenges and volatility of an ever-changing global market.”
Create New Competitive Advantages for Thailand’s Petchem Industry
GC brings advantages and expertise in managing a flexible and diverse feedstock mix, including naphtha, LPG, propane, and ethane. Its refinery business also enhances feedstock supply security and its ability to respond to uncertainties in global energy and petrochemical markets. These capabilities are complemented by research and product development expertise that addresses customers’ needs and applications.
SCGC, meanwhile, brings strengths in high value-added (HVA) products, technology, and innovation, together with expertise in product research and development. Working closely with customers, SCGC translates business challenges and creative ideas into market-ready products through its i2P Center (Ideas to Products), an integrated innovation center.
Combining these strengths will create greater opportunities to develop high value-added products, expand the customer base, and introduce new solutions for industries with growth potential, such as automotive, solar energy, construction materials, and specialized industrial products. A stronger upstream foundation will, in turn, strengthen downstream businesses.
The combined business will also benefit from a worldwide market network and customer base, enhancing its ability to respond to market demand, particularly in ASEAN, where long-term growth opportunities remain.
Improve Efficiency and Cost Competitiveness
Another key advantage is the proximity of the two companies’ manufacturing facilities in Map Ta Phut, Rayong Province, a major petrochemical industrial hub in Thailand.
The partnership will enable more efficient management of feedstocks and production processes, as well as shared use of infrastructure, including feedstock pipelines, utilities, and production support systems. It will also facilitate knowledge sharing and the adoption of best practices from both companies.
These benefits will enhance cost competitiveness, improve asset utilization, and increase business flexibility—capabilities that are particularly important as the global petrochemical industry continues to face overcapacity and market volatility.
Beyond operational improvements, the partnership also aims to build a stronger financial position by enhancing profitability and cash generation to support future investment and growth.
New JV Structure
Under the proposed structure, the two companies plan to establish a joint venture in which GC will hold a 56% stake and SCGC a 44% stake, through a share swap with no cash consideration. The transaction will encompass their olefins and polyolefins assets and businesses in Thailand, including equity interests in related joint ventures.
This structure is designed to enable the new joint venture to manage the relevant resources and assets efficiently and make business decisions with greater agility, under a governance framework aligned with the respective shareholdings.
The two companies plan to proceed with the relevant steps and expect to seek shareholder approval in December 2026. They will then work to fulfill the conditions precedent (CP), including obtaining approvals from the relevant regulatory authorities during the first half of 2027, before undertaking the restructuring. Subject to shareholder and relevant regulatory approvals, and fulfillment of the stipulated conditions precedent, the joint venture is expected to be established in the second half of 2027.
The ultimate goal of this partnership is not only to create a larger business, but also to build a stronger, more competitive business that elevates Thailand’s petrochemical industry on the global stage.
