The strength of Britain's pound sterling has claimed another plastics processing victim with the financial collapse of thermoset injection and compression molder Hemo Ltd.
The Oldbury, England, processor went into administration, the equivalent of bankruptcy, June 18. Joint receivers John Kelly and Gurpal Johal were called in from accounting and insolvency firm Kroll Buchler and Phillips of Birmingham, England, to take over Hemo's management. It has £700,000 ($987,000) in debt.
Kelly said they have received about a dozen inquires from potential buyers across Europe.
Hemo formed as a compression molder of electricity meter casings for utility companies. It has branched into other thermoset parts, including heat-resistant saucepan handles and stove knobs. The company employs 50 at its 40,000-square-foot Oldbury plant. Hemo reported 2000 sales of £6.3 million ($8.8 million).
Baumgarten GmbH of Daaden, Germany, bought the firm a year ago. Baumgarten recently reorganized its plastics molding operations in Europe to concentrate processes at specific sites. The Hemo plant lost 75 jobs just before the administration, Kelly said.
With bank and trading debt mounting and Baumgarten's refusal to invest more money in Hemo, management agreed to call in the administrators, he said.
``The company has already undergone a process of rationalization and reorganization. We hope to achieve either a sale of the business as a going concern or alternatively, a formal restructuring of the business through a company voluntary arrangement [with the creditors],'' he said.