Specialty resin broker Transource Polymers Inc. has gone out of business, stranding some plastics molders and owing several materials makers.
Industry sources said a unit of Livingston, N.J.-based CIT Group changed its asset-based funding arrangements with Transource and precipitated the abrupt November shutdown.
Transource brokered resin distribution for major producers and generic suppliers including Formosa Plastics Corp. USA of Livingston, N.J.; Montell Polyolefins of Wilmington, Del.; Chevron Corp. of Houston; and Dow Chemical Co. of Midland, Mich.
Transource filled a niche providing molders with specific grades and types of resin. In recent months the firm had experienced some pricing erosion in line with the market.
During a period in 1996-97, the firm generated annual sales at a rate exceeding $60 million, an industry contact said. CIT took control of the inventory and receivables during the second week of November and closed the operation Nov. 19.
Most of the firm's 28 employees learned about the shutdown in meetings Nov. 19-20. Transource employed 35 at its peak.
Transource's corporate staff was located in Roslyn Heights, N.Y. Others occupied sales offices in Torrance, Calif.; Houston; and Elgin, Ill. The firm disconnected its telephones, and no official comment was available.
David Searles was instrumental in forming Transource in 1990 and led the company as chairman and chief executive officer. He drew an initial cadre of employees from Bamberger Polymers Inc., now of Jericho, N.Y. That action created business and employment issues that had led Bamberger and Transource into acrimonious litigation that was settled in August 1992.
In addition to Bamberger, Transource competed principally with H. Muehlstein & Co. Inc. of Norwalk, Conn.; Osterman & Co. of Barrington, Ill.; Performance Polymers Inc. of Leominster, Mass.; and M. Holland Co. of Northbrook, Ill.
New York law firm Otterbourg, Steindler, Houston & Rosen PC represents CIT in the Transource matter but maintains a policy of ``no comment on client matters,'' lawyer Lorenzo Marinuzzi said in a brief telephone conversation.
