Singapore oil refiner Aster still on M&A hunt, ‘open’ to IPO as assets mature

[SINGAPORE] Despite the uncertainties of the Middle East energy crisis, Singapore’s Aster Chemicals and Energy is still hungry for acquisitions and exploring new growth paths, including power imports from Indonesia to Singapore.

The company is also “open to opportunities” for an initial public offering when the time is right, its deputy CEO Andre Khor told The Business Times.

“We’re not here to be a flash in the pan and do a quick IPO (initial public offering),” said Khor, who is also group chief financial officer at Jakarta-listed Chandra Asri.

“Whatever we bring to IPO, when we bring it to IPO, will be a totally transformed, radical platform. But we are moving very quickly.”

Aster is an 80:20 joint venture between Chandra Asri and commodities giant Glencore. In the past year, it bought Shell’s Pulau Bukom refinery and various energy and chemicals assets on Jurong Island, while Chandra Asri acquired ExxonMobil’s Singapore petrol kiosk network.

As these assets mature and “the turnaround and transformation is on a stronger footing, then that window (for an IPO) may be there”, said Khor when asked about the timeline for a listing.

He added that the company is “actively engaging” Singapore’s Economic Development Board, industrial landlord JTC Corporation and the Singapore Exchange on how it can contribute to the Republic’s energy and chemicals industry.

Hunting for deals, Indo-Singapore synergies

Khor is on the lookout for more acquisition opportunities in the energy, chemicals and infrastructure sectors. The latter includes ports, land or sea-based logistics and water infrastructure.

With the Esso acquisition, Aster is also open to partnerships in the retail, mobility and real estate segments, he added. In March, it partnered supermarket chain Cold Storage to take over FairPrice Group’s retail operations at Esso stations.

Realising synergies between Aster’s Singapore facilities and Chandra Asri’s resources in Indonesia is another key focus.

Aster Power – the company’s power and steam generation business – is exploring the possibility of energy imports from the Indonesian island of Batam to Singapore. This aligns with the city-state’s ambition to import clean energy from its neighbours under the Asean Power Grid.

“A lot of this is still cooking, but what’s clear is we have a plan, we have Aster Power, and we are actively seeing how we can grow a new line of business,” Khor said.

Aster also plans to sell more bitumen from its Singapore facility to Indonesia, where demand for the crude oil derivative is growing with the need for more roads.

“Rather than just exporting off the rack, we will actually look to import (bitumen) to Indonesia: store, distribute, blend it and then serve our end-customers,” said Khor.

The company is taking a similar approach to ethylene, a vital petrochemical for plastics production.

In May, the company announced a US$80 million investment to double its ethylene export capacity at Pulau Bukom and deepen integration with the Chandra Asri’s cracker facility in the Indonesian coastal city of Cilegon.