Confirms Siam Cement keen for stakes in two Indonesian petchem firms
* Seeks Southeast Asian expansion
* PTT also eyes stake in Indonesia's Chandra Asri
* Shares up 1 pct, outperform market (Adds details)
By Pisit Changplagngam
Thailand's top industrial conglomerate, Siam Cement Pcl , will bid for two Indonesian petrochemical assets worth an estimated $1.1 billion, the company said on Tuesday, as part of a Southeast Asia expansion drive.
The deals are set to be another indication of increasing foreign interest in Southeast Asia's biggest economy, which is attracting investors because of strong economic growth and a buoyant stock market.
Siam Cement, 30-percent owned by the Thai royal family's Crown Property Bureau, said it was interested in PT Sulfindo Adiusaha, an Indonesian chemical producer controlled by Indonesia's Tanojo family.
South Korea's Hanwha Chemical Corp may also bid for Sulfindo Adiusaha, sources with knowledge of the deal said recently.
Sulfindo's owners, the Tanojo-controlled Victoria Group, are seeking to sell the whole company for about $700 million.
Separately, Singapore state investor Temasek Holdings Pte Ltd is trying to sell its 23 percent stake in PT Chandra Asri Petrochemical Tbk in a deal worth an estimated $400 million, two sources with direct knowledge of the deal told Reuters recently.
"We are interested in both petrochemical firms in Indonesia...details of the deals cannot be disclosed at this point because they are quite big deals," Siam Cement Chief Executive Kan Trakulhoon told reporters on Tuesday.
Thailand's top energy firm, state-controlled PTT Pcl is also keen to buy a stake in Chandra Asri, an industry source said last week, possibly through its PTT Chemical Pcl unit.
SOUTHEAST ASIA EXPANSION
Siam Cement and PTT group have aggressively scouted for opportunities for assets overseas, especially in Southeast Asia.
Siam Cement focuses on three core business: cement, petrochemicals, paper and packaging. Petrochemicals generally make up almost half of profits.
Valued at $13.2 billion, Siam Cement had cash of about 58 billion baht ($1.93 billion) at the end of June.
The company already has interests in petrochemical plants in Indonesia and its subsidiary, Thai Plastic Chemicals Pcl , has a polyvinyl chloride (PVC) plant in the country with a capacity of 120,000 tonne a year.
If Siam Cement acquires Sulfindo, the group would have PVC capacity of 200,000 tonnes a year, compared with total PVC capacity in Indonesia of 605,000 tonnes, and that would raise its market share to 33.1 percent from 19.8 percent, Kasikorn Securities said in a note to clients.
The conglomerate also planned to build a $3.5-4.0 billion petrochemical complex in Vietnam, but the project has been delayed since 2009. Siam Cement has said it expected to conclude a plan for the project in Vietnam by the middle of 2011.
At 0738 GMT, Siam Cement shares were unchanged after rising more than 1 percent earlier, while the broad index was 0.04 percent lower.
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