NEW YORK — LNP Engineering Plastics is looking pretty spry at age 50.
To prove it, the Exton, Pa.-based firm has announced the largest capital investment in its history — a $20 million project that will add a total of 10 new compounding lines at the company's seven worldwide plants.
At a May 27 press conference in New York, LNP also made public both its acquisition of GHA Plastics, a producer of recycled-content engineering plastics in Sugar Land, Texas, and an agreement with Bayer Corp. of Pittsburgh that will allow LNP to color match and produce small-lot quantities of Bayer's polycarbonate, ABS, PC/ABS and PC/PET.
``This is a major, major investment for us,'' said Kawasaki-LNP Inc. President and Chief Executive Officer Robert Schulz. ``We plan to improve the speed of our service and standardize our manufacturing process around the world.''
LNP Engineering Plastics is a division of Kawasaki-LNP, formed when Japan's Kawasaki Steel Corp. acquired LNP from Imperial Chemical Industries plc in 1991.
LNP, founded as a liquid nitrogen processor in a New Jersey garage in 1948, expects to post sales of more than $260 million this year. Sales were in the $100 million range as recently as 1992. A 1995 study by Cleveland's Freedonia Group ranked LNP as one of the five largest independent compounders in the United States.
According to Richard Burns, LNP Engineering president responsible for LNP Americas, the firm has experienced explosive sales growth ``because of a large influx of new products, global expansion and increased customer demand. Instead of customers buying 40,000 pounds of material every other month, they're buying 3,000 pounds several times a week,'' Burns said.
The new compounding lines will include six twin-screw extruders, two color concentrates lines and two Verton-brand structural composites lines. They will be spread out among LNP sites in Thorndale, Pa.; Santa Ana, Calif.; Columbus, Ind.; Raamsdonkveer, Netherlands; Fosses, France; Thornaby-on-Tees, England; and Seremban, Malaysia.
LNP's product line includes reinforced nylon and PC, internally lubricated thermoplastics, anti-static thermoplastics, long-fiber-reinforced thermoplastics and custom-colored neat resins.
The acquisition of GHA, a 5-year-old company that posted sales of $3 million last year, gives LNP an added presence in engineering plastics recycling, which Schulz described as ``a concept whose time has finally come.''
``We're not talking about making milk bottles into plastic benches here,'' he said. ``We're talking about top [original equipment manufacturers] in the automotive industry and other industries looking to use recycled-content materials in their products.''
GHA, which produces recycled-content PC, PC/ABS and other materials, will be renamed RC Plastics. Donald Edens, LNP's recycled business development manager, will serve as the renamed firm's general manager.
LNP has a five-year plan to double RC's 10 million-pound annual capacity and intends to move the firm to a larger facility in 1999, Edens said. RC now employs 10 in a 44,000-square-foot building.
The purchase is in line with OEMs' continued interest in obtaining recycled-content material from global compounders like LNP, Edens said.
``First the OEMs looked to the major polymer producers, but they had to ask if it was the producer's core competency or just a distraction,'' he said. ``Then they went to small compounders, but weren't sure if [small compounders] were financially stable. Now they're turning to global compounders because we can provide recycled content with an assured pedigree.''
The Bayer licensing agreement is the first of its kind between LNP and a major resin maker, officials said. The deal will affect lot quantities of 110-5,000 pounds.
Bayer's PC, ABS, PC/ABS and PC/PET will be color matched by LNP's Colorcomp unit and distributed by General Polymers of Columbus, Ohio; Prime Alliance of Des Moines, Iowa; and CC&P Engineering Polymers of Portland, Ore.
The deal was prompted by Bayer's decision that it no longer is profitable to meet small-lot sizes for pre-colored resins, said Colorcomp product marketing manager Matthew Miklos.