U.S. Plastic Lumber Corp.'s recycling acquisition spree isn't over.
With its latest deal, the fifth in the past five months, the Boca Raton, Fla., firm has taken its first step toward vertical integration.
On June 27, Earth Care, the company's plastic lumber marketing arm, bought EnviroPlastics Corp., a New England reprocessor. Terms of the deal were not disclosed.
Mark Alsentzer, U.S. Plastic Lumber president and chief executive officer, said in a July 2 telephone interview that the company will provide EnviroPlastics with money for capital expansions.
``The addition of EnviroPlastics brings to our company the raw material sourcing and processing technology necessary to accomplish our vertical integration strategy and is critical to the mass production of our patented, recycled plastic railroad tie,''Alsentzer said in a news release.
EnviroPlastics of Auburn, Mass., reprocesses post-consumer high density polyethylene to customer specifications. EnviroPlastics sources post-consumer HDPE from municipalities and major collectors.
``We plan to integrate [EnviroPlastics] into post-industrial scrap,'' Alsentzer added. ``We use a considerable amount [of post-industrial material] in our process.''
U.S. Plastic Lumber plans to expand capacity at the 25,000-square-foot EnviroPlastics plant immediately and construct another facility in the near future. The current plant can reprocess 15 million pounds per year, and U.S. Plastic Lumber expects to use 5 million to 10 million pounds per year. DuPont Co. of Wilmington, Del., also will remain a major customer.
U.S. Plastic Lumber wants to acquire or add space for more raw material production. It may use space at its Recycled Plastic Industries lumber unit in Green Bay, Wis. An alternative would be to find a plant between the Green Bay location and Earth Care's subsidiary in Sharon, Tenn.
EnviroPlastics expects to post sales of $6 million this year and has about 50 employees.
Earth Care has three plants that produce plastic lumber picnic tables, park benches, decking systems, marine pilings and railroad ties. They are in Lake Odessa, Mich., Sharon and Green Bay. Its Environmental Specialty Products subsidiary in Gasti, Calif., fabricates and distributes plastic lumber signs. Custom Pac Extrusion Inc., which recently was integrated into the Sharon plant, makes patented plastic rings.
U.S. Plastic Lumber also has a division that treats and recycles petroleum-contaminated soil and construction debris. The Clean Earth subsidiary is based in New Castle, Del.
Earth Care's sales last year were $6.6 million. However, the firm reported an operating loss of $3.6 million, bringing its accumulated deficit to $7.3 million.