PET recycler wTe Recycling Corp. has formed a partnership with one of its key post-consumer bottle suppliers.
The partner, Tomra of North America, invested $5 million in the new venture, called Ultrepet LLC. Tomra owns 38.5 percent of Ultrepet, but gradually will increase its ownership to 49 percent during the next three years.
WTe Corp. of Bedford, Mass., contributed all the assets of its PET recycling unit, Albany, N.Y.-based wTe Recycling. Other details of the financial agreement still are evolving, said wTe Corp. President David Spencer.
``Tomra had been a large supplier of ours,'' Spencer added. ``This allows us to build stronger ties, grow the business and expand into bottle-to-bottle [recycling technology].''
Tomra's $5 million investment will be used to improve operations, expand plant capacity and fund other projects, such as obtaining approval for use of the resin in food-grade applications.
WTe's Albany plant has increased capacity in the past two years from 40 million pounds a year to 70 million pounds a year.
The company takes in bales of PET bottles, grinds, sorts and washes them. It then sells pellets and flake to high-end markets such as sheet for thermoforming, strapping and bottles. The 100,000-square-foot plant operates four lines. WTe plans to invest $1.5 million to $3 million more in additional processing.
Tomra NA of Stratford, Conn., is a leader in reverse vending-machine technology, which is used in conjunction with bottle deposits. WTe claims to be the largest PET bottle recycler in the Northeast and had received bottles from Tomra. Only 20-25 percent of the PET bottles wTe received last year came from curbside recycling.
``Ultrepet assures Tomra of a strong and consistent market for Tomra's large quantity of bottle-deposit PET, particularly in the Northeast,'' Greg Garvey, president and chief executive officer of Tomra NA, said in a news release.
The Albany plant is centrally located to those supplies, he said.
During 1999, the combined operations of the former wTe Recycling Corp. and the new Ultrepet should generate sales exceeding $15 million, the companies said. In 1998, wTe Recycling reported sales of $13.4 million.
Tomra NA's parent, Tomra Systems ASA, is in Asker, Norway.