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CHICAGO — As part of its continuing attempt to develop specialized markets, LNP Engineering Plastics Inc. has announced a licensing agreement that will allow it to produce compounds using Dow Plastics' Questra-brand syndiotactic polystyrene. Robert Schulz, LNP president and chief executive officer, echoed Dow's claim that Questra will compete with nylon. Schulz said it is too soon in the process to identify possible end products for the material.

Questra ``resembles nylon 6/6 without the moisture sensitivity,'' said George Niznik, LNP's vice president of research and development.

The agreement is one of several LNP (Booth N5481) has developed in recent years to access technology from other companies. Exton, Pa.-based LNP has similar deals with GE Plastics, Shell Chemical Co. and DuPont Co. for various specialty product lines.

``We want to continue to fill niches major resin companies can't or won't get into,'' Schulz said in a June 13 telephone interview from his Exton office. ``Sometimes an area is too small for a major manufacturer, so we'll dust it off and see what we can do with it. If we can use it, the original company will get something back on it.''

LNP's activity in this area is tied into an industry trend which has seen the introduction of several new polymers, according to Niznik.

``In the '80s, there were no new polymers and the attitude was `We'll just blend what we have,''' he said. ``But that fell through as a concept. The alloy revolution fizzled and some polymers were pulled off the shelf and commercialized.''

The niche-market approach seems to be paying off for LNP, a division of Kawasaki Steel Corp. of Tokyo, which posted global sales of more than $200 million last year. In the last 18 months, the firm has acquired a compounding plant in Fosses, France, and opened a similar facility in Seremban, Malaysia.

Schulz said growth in Asia's business machines and electrical/electronics markets has led LNP to announce a second expansion to add manufacturing and office space at the 14-month-old Malaysian site.

LNP has maintained its progress while changing hands three times between 1976 and 1991.

The company was purchased by Beatrice Foods for $25 million in 1991 and sold to Imperial Chemical Industries plc for $83 million in 1985 before Kawasaki bought it for $100 million in 1991.

At NPE, the 49-year-old company is focusing on a new injection compression molding process for its Verton-brand long-fiber-reinforced thermoplastics.

Schulz said the new process will allow Verton users to maintain longer fiber strengths to provide better stiffness, strength and surface finish when producing larger parts.

The new process will make Verton especially more useful in automotive products, such as bumper beams and dash panel supports, according to Schulz.

Schulz added LNP's Verton marketing will not be affected by ongoing lawsuits against three competitors that LNP claims are infringing on the company's long-fiber-reinforced thermoplastics technology.

LNP filed suit in September seeking financial compensation from Polymer Composites Inc. and RTP Co., both of Winona, Minn., and DSM Engineering Plastics Inc. of Evansville, Ill.

``We're grinding through the legal preliminaries right now,'' Schulz said of the suits, which were filed in a federal court in Delaware. ``But it's important to us that our customers aren't affected by the legal situation.''

LNP also is working to commercialize a line of nylon-based compounds that can offer customers more-specific gravity weights. So far, the materials have provided better performance in audio cassettes and seatbelt inertial locking systems. The compounds have also shown potential as practice ammunition rounds for law enforcement agencies, where they could replace lead, a material with some environmental drawbacks.

``We've talked to law enforcement target ranges and they've said they sometimes have to shut down for a period of time because there's lead all over the place,'' Schulz said.

The industry role played by independent compounders will continue to grow, according to Schulz. Independent compounders accounted for 26 percent of 1995 U.S. compounding sales and are expected to handle 6 billion pounds of resin by the year 2000.

``If a standard product doesn't work or a base polymer is inappropriate, a customer will go to an independent compounder,'' said Schulz, who has been with LNP for 31 years, including the last six in his current position. ``We can complement what the major resin suppliers are doing by offering variations on their standard products.''