Color compounder Techmer PM LLC plans to realign its two Georgia plants after its recent purchase of Custom Colorants, a Dalton, Ga.-based color compounder previously owned by Martin Color-Fi Inc.
Custom, which operates three extrusion lines and employs 15 in a 30,000-square-foot plant, produces color and additive dispersions for the synthetic-fiber market. Martin Color-Fi, an Edgefield, S.C.-based fibers maker, had owned Custom since 1994.
Officials at Clinton, Tenn.-based Techmer said fiber compounds currently made at Techmer's Gainesville, Ga., plant will be transferred to Custom, freeing up capacity in Gainesville for nonfiber markets such as extrusion and injection molding. Techmer President John Manuck said his firm also is looking to expand the Custom site in the near future. The fibers market accounts for about 30 percent of Techmer's $130 million annual sales total.
Terms of the deal were not disclosed.
The deal was struck in the midst of an ongoing dispute between Techmer and PolyOne Corp., the Cleveland-based compounding giant that owns 51 percent of Techmer.
Manuck and the three American and Asian investors who own the other 49 percent have been trying to exit the joint venture since early 2000. Techmer formed the venture with PolyOne predecessor M.A. Hanna Co. in 1997, but Manuck claims Hanna began to violate terms of the deal shortly thereafter.
Manuck now claims Hanna's 2000 merger with Geon Co. to form PolyOne essentially voided the Techmer-Hanna joint venture. He has asked the American Arbitration Association to separate his firm from PolyOne, but the case has been delayed by complications surrounding PolyOne's formation, Manuck said. A decision now is expected by mid-2002.
New York-based AAA does not release details of specific cases, according to spokesman Kersten Norlin. The length of a case is determined by the complexity of the issues involved, and is largely determined by the parties in the case, Norlin added. Cases are typically concluded 30-45 days after a final hearing.
The four PolyOne officials on Techmer's seven-member board of directors approved the Custom deal, but Manuck and his partners - operating as TPM Holdings of Los Angeles - are pursuing acquisitions on their own, including a deal to buy two Ciba Specialty Chemicals AG compounding plants in Saudi Arabia and Malaysia.
PolyOne does not count Techmer's $130 million in annual sales in its own revenue totals, according to spokesman Dennis Cocco. The firm does, however, include Techmer's earnings - as well as those from other equity ventures - in its performance plastics unit. In 2001, the unit reported profit of $7.1 million, but Cocco declined to say how much of that amount was generated by Techmer.
PolyOne posted an overall loss of $46 million in 2001.
Cocco did not seem overly concerned about PolyOne's paying part of the cost of an acquisition for a joint venture with a reluctant partner.
``We have a good relationship with Techmer, but we have a disagreement,'' he said. ``That's what arbitrators are there for.''
Manuck added that the Techmer facilities - which employ 500 in Clinton; Gainesville; Rancho Dominguez, Calif.; and Wichita, Kan. - will not be affected by PolyOne's Project Triple Crown initiative.
The plan calls for closing 18 plants and eliminating 600 jobs by the end of 2002, as well as investing $50 million for improvements and new equipment at PolyOne's 20 remaining sites.