Thailand's Siam Cement and PTT Global Chemical are forming a petrochemical joint venture valued at over $5 billion, aiming to strengthen their position in an increasingly challenging industry.
The move will combine the two companies' olefins and polyolefins businesses, merging capacity to produce two of the key chemical building blocks for plastic and fuels.
Thammasak Sethaudom, chief executive of Siam Cement--one of the biggest industrial conglomerates in Southeast Asia--said the transaction will boost efficiency and improve the companies' ability to rival international producers.
"The global olefins and polyolefins industry is experiencing increasingly intense competition, placing continued pressure on product spreads and operating rates," he said.
The venture is expected to generate recurring annual benefits of over 5.1 billion baht to 6.8 billion baht, or around $150 million to $200 million.
According to filings late Wednesday, Siam subsidiary SCG Chemicals will hold a 44% share of the combined business, with the remainder controlled by PTT Global, Thailand's largest integrated petrochemical and refining business.
Pending approvals, including from the companies' shareholders, the deal is expected to close in the second half of next year.
Siam Cement shares were last 4.7% lower in Thursday trade, underpeforming the benchmark index's 0.8% decline, according to LSEG data. PTT Global was down 8.3%, on track for its biggest one-day decline since April 2025.
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