Resin distributor Channel Prime Alliance has opened its doors after completing the merger of Channel Polymers and Prime Alliance.
The new firm - with offices in Norwalk, Conn., and Des Moines, Iowa - will have annual sales of more than $200 million and expects to hire five more sales reps in the next year, company officials said in a Sept. 1 news release.
``There was very minimal overlap between the two companies, so now there are a lot of cross-selling opportunities,'' said David Skoczen, the Channel general manager who will hold the same role with the new firm. ``Right now, we're out there making sure our customers are aware of our much broader product offering.''
Channel had focused on distributing commodity resins like polyethylene and polypropylene, while Prime Alliance had centered its business on engineering resins. Channel, a division of global plastics and rubber broker H. Muehlstein & Co. Inc. of Norwalk, will have majority ownership in the new firm.
Prime Alliance President Tom Irvine will remain active with CPA as a director. His father, Chuck, founded Prime Alliance in 1981. Muehlstein formed Channel in 1996 to offer just-in-time service to small and midsize customers.
CPA now offers a lineup of about 30 international resin suppliers, including Atofina Petrochemicals, BASF Corp., Bayer Corp., Dow Chemical Co., Exxon Mobil Chemical Co. and Ticona. The firm expects to ship more than 200 million pounds of resin each year.
Skoczen said that ``the most common thread'' between the two merged businesses was in their injection and blow molding accounts, which now will offer the most immediate chances to grow sales. Muehlstein will continue to serve larger-volume film and pipe extrusion accounts.
The amount of resin sold via distribution in North America is increasing, and the trend does not seem to be affected by this year's major run-ups in resin pricing, which have been tied into higher costs for natural gas, crude oil and related feedstocks. Skoczen said that CPA's volumes are up 30 percent so far this year, and that the firm expects to average 25 percent annual volume growth over the next five years.
U.S./Canadian sales of linear low density PE to distributors were up 45 percent in the first half of 2003, while sales of high density PE to that market were up 33 percent, according to the American Plastics Council in Arlington, Va. APC places U.S./Canadian PP sales to distributors up 13 percent from last year.
``The resin makers aren't making their decisions [to sell through distributors] based on the fact that we're on the high-scale end of the pricing market,'' Skoczen said. ``They're just continuing to shift pieces of business that can be more efficiently served through distributors.''