ExxonMobil announced yesterday that it will create a new company for its finished lubricants and chemicals business in Thailand after agreeing to sell its controlling stake in Esso Thailand to Bangchak Corp.
Bangchak Corp., an oil and energy business headquartered in Bangkok, agreed Jan. 11 to acquire ExxonMobil’s 65.99% stake – approximately about 2.28 billion stock shares – for a price to be determined later. The stake has a value of ฿23 billion (U.S. $689 million) based on the Wednesday’s closing price for the stock, but Bangchak estimated Esso Thailand’s overall value at ฿55 billion.
Bangchak said it will also launch a tender offer for the remaining ordinary shares after the completion of the initial transaction with ExxonMobil.
The transaction includes a 174,000 barrels per day complex refinery, a network of distribution terminals and more than 700 service stations.
As part of the transaction, ExxonMobil said it will retain the finished lubricant and chemical marketing businesses in Thailand. Its lubricant products include Mobil lubricants, ExxonMobil marine lubricants and aviation lubricants. Mobil lubricants offered include products for passenger car and heavy duty automotive, two-wheeler and industrial applications.
ExxonMobil added that the deal will not affect local upstream business ExxonMobil Exploration and Production Khorat Inc. nor ExxonMobil’s Bangkok Global Business Center, which employs about 2,000 people.
“As we execute our strategy, ExxonMobil is focusing its investments on global production facilities to meet the world’s demand for lower-emissions fuels and high-performance products, while divesting assets where others see the potential for greater value,” Karen McKee, president of ExxonMobil Product Solutions, said in a press release. The company said Esso Thailand has supplied products to the Thailand and Greater Mekong markets for more than 125 years.
Bangchak operates a refinery that produces gasoline and diesel. It also has a biobased product business that makes and distributes biodiesel, ethanol and crude palm oil.