Connecticut-based Plastics One Inc. has acquired a Detroit-area used-machinery dealer and plans this year to expand into California and the Atlanta area, establishing a nationwide network of facilities.
Plastics One is buying Engineered Plastics Equipment Co. of Warren, Mich. The acquisition, for undisclosed terms, became effective May 1.
Plastics One President Robert Risbridger said the Michigan facility gives his company better access to large-machine markets, such as automotive and appliance. Engineered Plastics specializes in larger-tonnage machines, of 1,500 tons and above. Engineered Plastics, which is finishing up a move from Fraser, Mich., to Warren, can stock machines with clamping forces as large as 3,000 tons.
Erik Eggen, who founded the company in 1987, will remain to run it. Eggen is a mechanical engineer with a background in machinery sales.
Plastics One, founded in 1975, buys used machines from around the country and ships them to its central headquarters in Wallingford, Conn.
``To better serve those regional markets, we want to put those machines closer to the customers,'' Risbridger said, explaining the expansion.
Engineered Plastics has three employees. Plastics One employs 13 in Wallingford. Risbridger also is a partner with Kenneth Heyse in a year-old company that sells used robots, Plastics Automation Exchange Inc., which is located in the Plastics One building.
Plastics Automation now employs seven. Heyse, president of the company, said Plastics Automation has begun remanufacturing robots for customers and building new end-of-arm tooling for robots, not merely reselling used robots and tooling.
This year, Risbridger wants Plastics One to expand to Los Angeles and Atlanta.
``I'm looking for the geography,'' Risbridger said. ``It's our belief that the used machinery business is a provincial business. The buyers tend to go to suppliers nearby.''
In the plastics industry, recent years have not been kind to used-machinery dealers.
Plastics One saw a significant decline in business in the mid-1990s, as demand dried up for pre-1985 machines and the processing sector consolidated, according to a business plan Risbridger drafted to explain the nationwide expansion.
Molders acquiring other molders led to an oversupply of older used machines, as the acquiring companies engaged in ``cherry picking'' of the newer machines and sold off older ones, according to the business plan. Even more vintage machines became available as new-press sales boomed in recent years.
But Risbridger said that vintage machines have become hard to sell.
``Molders no longer want a 15-year-old machine, regardless of the condition. They want 1990 and newer, with microprocessor controls,'' he said in an April 30 telephone interview.
After a few rough years, used-machine dealers have adjusted to the new market. Still, Risbridger terms used-press sales today as ``spotty.''
``The market has firmed up and it's been clearly established now that the used-machine buyers want clean, late-model equipment,'' he said.