Rapid Granulator AB has filed for financial restructuring, according to news reports in Sweden. The company blamed slumping machinery sales and the cost of a recent acquisition of a recycling equipment maker in China.
Bredaryd-based Rapid Granulator has U.S. operations in Franklin, Pa.
The company will lose 20 million Swedish kronor ($2.87 million) this year, according to a report in the VÃ¤rnamo (Sweden) Nyheter newspaper, which quoted from a letter from CEO Rolf Gren.
The letter reportedly emphasizes that Rapid has not filed for bankruptcy, and that it will continue with business as usual. The firm plans to reduce debt voluntarily, in cooperation with its lender Nordea Bank AB.
According to news reports and machinery sources, Swedish law allows firms that have filed for reorganization to restructure their debt and modify their labor contracts.
In June, at NPE2009 in Chicago, Rapid announced that it had purchased Avian (Shanghai) Machinery Co. Ltd., in order to serve the market in Asia. Avian makes pulverizers and larger granulators.
Rapid has plants in the U.S, Germany, France, Italy, Singapore, China and the Middle East. It employs 300, and supplies equipment to customers in 150 countries. The company is a sister company to Conair Group Inc. Both are under the umbrella of International Plastics Equipment Group Inc. of Cranberry Township, Pa., a Pittsburgh suburb.
Chris Keller, president of IPEG and Conair, said in a statement that Rapid's action is specific to its Swedish business entity: It has no bearing on Rapid's business outside Sweden. Furthermore, while Rapid and Conair share common ownership (IPEG), the activities of Rapid AB have no impact on the Conair business.
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