Resin distributor Osterman & Co. has acquired Plastic Compounding & Chemical Corp., a small Chicago-based competitor.
The purchase price was not disclosed. PCCC has four employees and distributes prime polyethylene, polypropylene and polystyrene via public warehousing. The firm is a licensed distributor for PP maker BP plc and a handful of other resin producers.
The deal will strengthen Osterman's presence in Chicago and throughout the Midwest, said President James Dwyer, a longtime Osterman executive who bought the firm from founder Russell Osterman last year.
Dwyer added that his firm is looking to make more acquisitions both in distribution and compounding. Osterman distributes prime and nonprime PE, PP and PS nationwide and also compounds engineering resins - as Engineered Polymers Industries - in Chicopee, Mass.
After buying Osterman, Dwyer moved its headquarters from Barrington, Ill., to Cheshire, Conn., where he has lived and worked for several years.
Osterman posted sales of about $150 million last year, a total that was basically unchanged from 2000. Dwyer expects sales growth of as much as 10 percent this year, as a result of the PCCC acquisition and the addition of new sales staff. Osterman expects to add as many as five new sales representatives this year to its current total of 20.
Overall, Osterman employs 70. The firm does about 60 percent of its sales in distribution of nonprime resin, with 30 percent in prime resin distribution and 10 percent in compounding.
PCCC co-owner Gordon LaBounty Jr. will remain with Osterman, while co-owner Robert Albiani will serve in a limited consulting role. Albiani found PCCC in the mid-1970s with Gordon LaBounty Sr., who is retired.
In spite of its name, PCCC exited the compounding market at least 20 years ago, Dwyer said.
The trend of resin makers giving distributors a larger chunk of their business is continuing in spite of the recent economic downturn, Dwyer added.
``Distributors now are an accepted channel to market that are finally getting full credit,'' he said. ``We've proven we can handle both prime and nonprime resin.''
