Polysilicon maker OCI to spin off its major chemical units

The firm aims to strengthen CEO Lee's dominance via in-kind contribution after the spin-off, sources say

Ma Steel OCI, an OCI pitch factory in China (Courtesy of OCI)
Ma Steel OCI, an OCI pitch factory in China (Courtesy of OCI)
Kyung-Min Kang 1
2022-11-23 20:19:31 kkm1026@hankyung.com
Chemical Industry

OCI Co., South Korea’s lone polysilicon producer, is set to spin off its chemical units and transform itself into a holding company.

On Wednesday, the firm’s board of directors decided to spin off two major arms, the basic chemical and carbon chemical divisions, and set up a new corporation for the units. The scheme needs to be confirmed at the general meeting of shareholders in March 2023.

OCI will be separated into a holding firm and a new chemical corporation, which will absorb the two units. The existing shareholders will be allocated stocks in a 69:31 ratio between the holding firm and the new entity.

The basic chemical unit, producing and selling polysilicon, accounts for 40% of OCI’s overall sales. The carbon chemical unit manufactures and sells carbon black, benzene, pitch and other chemicals.

Through the spin-off, OCI aims to enhance its chemical business efficiency as well as bolster CEO and Vice Chairman Lee Woo-hyun’s power in the group, market sources said.

Lee, the eldest son of the late chairman Lee Soo-young, owns just a 5% stake in the company. The late chairman’s younger brothers, chemical trading firm Unid Global Corp. Chairman Lee Wha-young and energy supplier SGC Energy Co. Chairman Lee Bok-young, each hold 5.4%.

The current CEO is highly likely to execute the new chemical entity's equity contribution to the new holding firm, thus increasing his shareholding rate in the holding firm, sources said.

Write to Kyung-Min Kang at kkm1026@hankyung.com
Jihyun Kim edited this article.
#OCI Korea #Korean polysilicon maker #OCI basic chemicals #OCI carbon chemicals #Korean company spin off #Korean chemical company

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