PHOENIX — Ekco Group Inc. said it will not proceed with a five-year contract announced in November with AB Plastics Corp. Instead, Mulay Plastics Inc. will begin molding for Ekco's West Coast customers.
Ekco also announced it has completed the sale of its Phoenix manufacturing and distribution facility to Plastican Inc. for about $4 million. Ekco will maintain a warehouse in Phoenix, where products made at Mulay's Casa Grande, Ariz., facility will be stocked and distributed. John T. Haran, vice president and treasurer for Nashua, N.H.-based Ekco, said Mulay will start using Ekco's molds immediately.
``It was mutually agreed upon that we wouldn't go forward with previously announced plans'' with AB Plastics, said Haran.
Custom injection molder AB Plastics specializes in television housings, consumer electronics enclosures and computer monitors. Michael A. Gibbs, AB Plastics chief executive officer, would say only that Ekco and AB are ``still unwinding the contract.'' However, Gibbs indicated that a surge of recent new business from AB's customer base in the consumer electronics industry forced a rethinking of the Gardena, Calif., company's direction.
Jack Shedd, Mulay national sales manager, said Ekco looked at Mulay's housewares capabilities and what the company could offer Ekco, and made the change. Mulay molds for Bemis Manufacturing Co. and other original equipment manufacturers of housewares and lawn and garden furniture.
Mulay has a large warehouse adjacent to its 200,000-square-foot manufacturing facility, in which it houses lawn furniture and housewares before shipment. Shedd said the firm has added several new presses recently, but might have to add capacity depending on whether Ekco meets or exceeds its projections. Mulay operates 28 injection presses, with clamping forces of 75-1,500 tons.
Mulay has four molding facilities, including one in Tijuana, Mexico, that was dedicated Jan. 16. Workers completed a new, 40,000-square-foot warehouse addition next to the main plant.