Recycler Coll Materials Exchange LLC is closing its Allentown, Pa., facility and consolidating those operations into its Zanesville, Ohio, headquarters plant. In a separate matter, the company is once again facing a breach-of-contract complaint from chemicals giant Eastman Chemical Co.
The closing and consolidation are spurred by another venture in North Carolina, planned to be completed by the end of the year, President and CEO Brian Coll said in an Oct. 24 phone interview. “We are buying a company in North Carolina that does plastics recycling.”
He declined to name the acquisition target, but sources told Plastics News that it may be the Recycle America LLC plastics recycling plant in Raleigh, N.C., that Waste Management Inc. has on the market.
“It doesn't make sense to have plants in Pennsylvania, Ohio and North Carolina,” Coll said. “So we are slowing that plant down and are going to consolidate it into the Ohio facility” sometime in the next three to six months.
Brian Coll denied a rumor that the company's $6 million Waco, Texas, plant — which opened about one year ago — was closing.
“We have no intention of closing that factory,” said Coll, who was on his way back from Allentown after telling the plant's employees Oct. 23 of the impending closure.
However, Coll did say that the Waco plant stopped making composite railroad ties from recycled plastics for Axion International Holdings Inc. six weeks ago. The Waco plant, which has 25 workers, continues to make post-consumer pellets, roughly 500,000 pounds per week — the majority of it high density polyethylene, Coll said.
An executive at Providence, N.J.-based Axion confirmed that the Waco extrusion line for making railroad ties was shut down at the current time. But, he added that “we have no permanent plan to keep it shut down.”
The Waco plant has the capacity to produce 122 million pounds of recycled materials annually and has two wash lines, a dry line, three 8-inch extruders to make pellets, four granulators and fiber-separation operations. Based on its current output, however, the plant is producing — on a projected annual basis — 26 million pounds per year.
Coll said the company's Zanesville plant is reprocessing 55 million pounds annually. He said $7 million worth of equipment at Allentown — wash lines, grinders, extruders, pelletizers and metal separation equipment — will be moved into the Zanesville plant.
The plant in Allentown opened late last year after a fire in August destroyed the Nicos Polymers & Grinding Inc. plant in Nazareth, Pa., that Coll had acquired in February 2011, after Nicos went into bankruptcy.
Coll said that workforce — once as high as 65 — now is down to what he called “a skeleton crew” of 15 people, as currently the plant is only doing tolling.
Earlier this year, Coll Materials officials said the company had invested $12 million to $13 million in equipment for its Allentown plant.
Meanwhile, chemicals firm Eastman has refiled a breach-of-contract complaint against Coll Materials in U.S. District Court in Wilmington, Del., after withdrawing the same lawsuit from a different court jurisdiction.
The complaint charges Coll with breach of contract, negligence and failure to reimburse Kingsport, Tenn.-based Eastman for loss of Eastman materials — valued in excess of $75,000 — that were stored at the warehouse of the Coll recycling plant in Nazareth, which was destroyed by the Aug. 2, 2011, fire.
The complaint was initially filed in U.S. District Court for the Eastern District of Pennsylvania, but was withdrawn Oct. 1, just 13 days after it had been filed. It was then filed again, earlier this month, in Delaware, said attorney Terry Henry of Philadelphia-based law firm Blank Rome LLP, which is representing Eastman.
Eastman charges Coll with failure to safely store and prevent damage to Eastman materials at the plant. The lawsuit said Coll assumed responsibility for a contract — drawn up between Nicos and Eastman in 2005 — when Coll acquired Nicos.