SCG Chemicals proposes Thai petrochemical combination

SCG Chemicals filed a proposal on 28 October 2026 to combine its Thai olefins and polyolefins business with that of PTT Global Chemical. The combined businesses are valued at 187 billion Thai baht ($5.5 billion). Fortune said shareholders are due to vote on the proposal on 3 December.

SCG Chemicals, a business unit of Siam Cement Group, would hold 44% of the joint venture. PTT Global Chemical, Thailand’s largest petrochemical company, would hold the majority 56%. The combination has not been completed.

Olefins are chemicals used to make other materials; PTT Global Chemical, a subsidiary of PTT Public Company Limited, specializes in synthesizing olefins and aromatics; its olefin products mainly consist of ethylene and propylene. Polyolefins are plastics made from olefins and used in products such as packaging.

Pressure from competition

At the time of the announcement, Siam Cement Group CEO Thammasak Sethaudom said growing global competition was putting continued pressure on product spreads—the difference between product prices and input costs—and on operating rates at plants.

At a summit in Ho Chi Minh City on 3 November, Sethaudom said manufacturers had to adjust to Chinese overcapacity, when factories can produce more than customers are buying. He argued that production needed to be large enough to serve the whole Southeast Asian region.

The proposed combined entity is targeting recurring annual benefits of 5–6 billion baht, The Standard reported. It cautioned that consolidation on this scale could make local prices easier to dictate and affect Thai plastics manufacturers' costs and competitiveness.

Approvals ahead

Both companies plan to seek shareholder approval at general meetings in December and apply to the Trade Competition Commission of Thailand in 2027, The Standard said. It said completion was expected in the second half of 2027.