KDB Begins Supporting Yeochun NCC's Business Structure Innovation

Korea Development Bank (KDB) has begun the process of supporting business structure innovation for Yeochun NCC, the nation's largest ethylene producer. This initiative aims to enhance the competitiveness of Korea's petrochemical industry.

On the 20th, Yeochun NCC, Hanwha Solutions, DL Chemical, and Lotte Chemical jointly submitted a business reorganization plan to the Ministry of Trade, Industry and Energy and applied for financial support from KDB, their main creditor bank. The plan involves splitting Lotte Chemical's Yeosu plant's naphtha cracking facility, integrating it with Yeochun NCC, and establishing a new entity. This new entity will merge DL Chemical's polyethylene, Hanwha Solutions' Yeosu polyethylene and petroleum resin operations, and Lotte Chemical's basic materials Yeosu division. The move aims to adjust production capacity and pivot towards high-value products.

KDB will convene a consultative body of Yeochun NCC's creditor financial institutions to discuss the business reorganization plan and the financial support application. Taking into account the recent situation in the Middle East, KDB will expedite all procedures and, after an on-site inspection by an external specialized agency, plans to prepare the necessary financial support measures until the business reorganization is complete.

On the 20th, KDB resolved financial support measures for Daelim No. 1, the first business reorganization project in the domestic petrochemical sector. The Daelim No. 1 project, approved by the Business Reorganization Deliberation Committee on February 23, includes debt deferrals totaling approximately 7.9 trillion won, new funding of up to 1 trillion won, and conversion of up to 1 trillion won of existing loans into perpetual bonds.