Sealright Co. Inc. is considering selling its plastic container operation in Los Angeles. The board of directors will make its decision by the end of the year, said spokesman David Burket.
The 190,000-square-foot plant primarily thermoforms, but also injection molds, yogurt, cottage cheese and sour cream tubs. Sealright recently converted its materials from polystyrene to poly-propylene.
The company, a manufacturer of packaging and packaging systems for dairy, food and beverage products, cited several reasons why it may sell the plant. Sealright's other businesses are international in scope while the plastics operation serves only the West Coast.
The plant also has weathered some problems, according to the third-quarter report, including rising raw material costs two years ago, Burket said.
Another difficulty was in converting to a new kind of equipment to make PP containers. The company had a hard time converting some customers to PP containers.
``The board needs to decide if the short-term problems outweigh the long-term benefits,'' Burket added.
Sealright announced a corporate restructuring late last year. The plan called for increased efficiency and cutting costs.
Company headquarters and research and development were moved from Overland Park, Kan., and Kansas City, Mo., to DeSoto, Kan. If the company does sell the plastics operation, Sealright could take a $4 million charge against earnings during the quarter.
To complete the reorganization, the company plans to consolidate its Charlotte and Raleigh, N.C., facilities that produce flexible packaging and other equipment into other Sealright plants. About 146 employees will be affected. Some 20 employees will be offered other positions within Sealright while all others will be laid off with severance pay.
The Charlotte flexible packaging plant is set to be closed in early 1997 and eventually sold. Production and equipment will be moved to plants in San Leandro, Calif., and Akron, Ohio.
Also by the end of the year, assembly of labeling equipment will be moved from the Raleigh plant to DeSoto. A small sales and service office will be maintained in Raleigh.
Sealright Co. reported sales of $209 million for the nine months ended Sept. 30, compared with $230 million for the same period last year.