AEP Industries Inc. will stop manufacturing Resinite PVC film and polyethylene pallet wrap at a plant it acquired from Borden Inc. About 320 jobs, mostly manufacturing, will be phased out at North Andover, Mass., during the next four months, according to an AEP spokesman. In addition, AEP will cut another 40 administrative and sales jobs, mainly at North Andover, where Borden's global packaging business was based. AEP finalized a $360 million deal to buy that business Oct. 11.
A second plant in North Andover, which makes oriented polypropylene film, will remain open, said Brendan Barba, AEP's chairman and chief executive. AEP will attempt to relocate many of the displaced North Andover workers to other AEP operations, he said by telephone from the firm's South Hackensack, N.J., headquarters.
Closing the facility will save AEP about $18 million for the fiscal year ending Oct. 31, 1997; that sum is nearly one-fourth of the $25 million the firm had hoped to cut from production costs by 1998.
The company plans to sell the plant, sack older machines and transfer newer, state-of-the-art extrusion and other equipment to other AEP plants, according to Barba.
``The North Andover facility was not consistent with the productivity and logistical advantages that characterize the rest of the AEP system, and upgrading the plant would have required excessive capital expenditures,'' he said. ``Our remaining plants have ample capacity to serve the customers formerly supplied by North Andover.''
Four more former Borden plants in North American make PVC film. Before buying the Borden business, PE film made up nearly all of AEP's $243 million in sales, with pallet wrap contributing a significant chunk of that. Borden brings AEP $250 million in North American sales, and $375 million in overseas business, for PVC, PE and OPP film and some rigid plastic packaging.
AEP does not expect to close any other former Borden plants in North America, but will continue to seek ways to make them more efficient, according to the spokesman. As a result, ``some of our operations will grow and some will shrink,'' he said.