Thai Oil Plc (TOP), Thailand largest oil refinery by capacity, is preparing to raise funds to finance a US$5 billion development of PT Chandra Asri Perkasa (Unit 2), a petrochemical production facility in Indonesia.
The fundraising is scheduled to come from sales of TOP shares and its share dilution in Global Power Synergy Plc (GPSC).
The TOP board recently approved the increase of registered capital by 2.75 billion baht to 23.15 billion through a public offering scheme.
TOP plans to sell a maximum of 239.23 million shares to existing shareholders and offer 35.88 million shares under an over-allotment scheme.
The board also approved the sale of a 10.78% share worth 22.35 billion baht, from a total 20.78% stake in GPSC, to its parent firm PTT Plc.
PT Chandra Asri Perkasa (Unit 2) has a plan to increase capacity of petrochemical crackers to 8 million tonnes a year, up from 4.2 million tonnes. Construction is slated to begin this year, with commercial operation scheduled to start in 2026.
The facility is operated by PT Chandra Asri Petrochemical Tbk (CAP), Indonesia's largest petrochemical producer.
TOP acquired a 15.38% share in CAP at a cost of $1.18 billion in July last year.
According to TOP, the two sources of funding are in line with its financial restructuring to increase financial capability, including loan payment for the CAP share trade deal.
The restructuring will enhance the company's competitiveness in the downstream petroleum businesses, said Wirat Uanarumit, president and chief executive of TOP.
Once the capacity expansion is completed, TOP will supply feedstock to PT Chandra Asri Perkasa (Unit 2).
The feedstock is projected to come from TOP's Clean Fuel Project, which aims to increase oil refinery capacity by 45% to 400,000 barrels per day.