Conglomerate JG Summit Holdings Inc. said Friday it is injecting P5 billion in fresh capital into its ailing petrochemical unit.
JG Summit said in a disclosure to the stock exchange its board of directors approved the planned capital infusion, via share subscription, into wholly-owned subsidiary JG Summit Olefins Corp.
“JGSOC will use the funds to pay off its expansion project obligations and to support its operations during a period of declining market demand and rising input costs,” JG Summit said. The additional capital infusion aims to improve the JGSOC’s financial liquidity position, the conglomerate said.
Under the plan, JG Summit will subscribe to additional 714 million shares in JGSOC at P7 apiece in exchange for the P5-billion cash infusion.
JGSOC operates a fully-integrated manufacturing complex in Batangas City. It manufactures polyethylene and polypropylene, polymer gradeethylene, polymer grade propylene, partially hydrogenated pyrolysis gasoline, pyrolysis fuel oil, aromatics, butadiene, and liquefied petroleum gas.