Distributor and compounder Ter Hell Plastic GmbH is closing its production facility in Herne, Germany, and outsourcing its compounding to partners.
The restructuring is part of a strategy being implemented by Wolfgang Siegel, who became the company's CEO in January, to grow the business on an international scale. The company has also changed its name to Ter Plastics Polymer Group.
The company said the Herne facility required modernization but the investment could not be justified. The plant is scheduled to shut in December, with the loss of 27 jobs.
"The main reason for the closure of the Herne facility is the enormous investment that would have been necessary," said Eva Masthoff, head of marketing and communication.
Ter Plastics will now use partner companies in Europe and other regions around the world for its compounding. Masthoff said the product development knowledge will still belong to the company.
The partner companies will make Ter Plastics' Terez brand of compounds, which include ABS, polyamide, polycarbonate and blends. The group's ability to offer custom compounding to its customers will continue.
Masthoff said one advantage of using partner compounders is that Ter Plastics will be able to get closer to its international customers.
The reorganization will also involve the sales function being boosted, with new sales staff being added.
Masthoff also said Ter Plastics expects to make some international acquisitions, although there is nothing to announce yet.