UPDATED: Hose extruder TekTube Group LLC, which serves the spa, pool and beverage industries, has been put up for sale by its parent company, PVC compounder Roscom Inc., and is likely to be sold piecemeal to several buyers.
Based in Croydon, Pa., the two businesses have been sharing space since 2006, when TekTube started moving the first of its 10 extrusion lines out of Las Vegas. The remaining lines were relocated in 2008.
Roscom now needs that space and TekTube's 12 employees for the production of compounds using non-phthalate plasticizers, which it launched in February 2014, Bill Quinn, vice president of Roscom operations, said in a telephone interview.
Eight sets of TekTube coextrusion lines, two clear tubing lines and intellectual property, including patents and National Sanitation Foundation certifications, are for sale. Quinn said July 21 that the company has talked to three interested buyers and will meet with at least eight more in the next week.
“I don't believe the company will be sold as an on-going entity,” he added. “I believe we will piece it off. Some will buy some equipment, others other equipment, some will buy some equipment and the intellectual property.”
TekTube claims to have introduced more product lines for the pool and spa industry than any other hose manufacturer. Founded in 1998, the company started out with 19 employees making reinforced spa hoses out of coextruded flexible PVC over rigid PVC to reduce the chance of leaks.
The company has multiple trademarks and patents. Sales were about $13 million when it completed its move to Croydon seven years ago.
“We have some specialty patented products and our customers are concerned if we go out of business they won't be able to get a hold of it,” Quinn said. “At least two companies are interested in acquiring that technology.”
TekTube will cease operations on Sept. 1.
“We're willing to make as many orders as customers want” until then, Quinn said. “They have to pay cash in advance and guarantee to take the material. Some customers have ordered their supply to year end because they want to make sure they're set. Effective Sept. 1, I'm shutting down all the equipment.”
All the production and storage space dedicated to TekTube then will be used to make compounds for the new markets Roscom is entering. Plastics News reported last year that sales of its new materials were strong right away. Various health risks have been alleged against phthalates.
TekTube was among the first companies to use Roscom's non-phthalate compounds in its products. In an Earth Day ad in April, TekTube promoted its Reach Flex line for pools and spas as having no phthalates and told customers they could request non-phthalate materials in its Neu-Gen and Ultra Flex product lines at no extra cost as well.
Roscom's new material line is compliant with the European regulation for the Registration, Evaluation, Authorization and Restriction of Chemicals (REACH), which aims to prohibit the use of toxic substances in products.
“In order to do it and be truly REACH compliant — it's a European standard but it's starting to come to the U.S. —you have to have an incredibly low parts per million of ortho-phthalate in it,” Quinn said. “The only way we could get this to work correctly was to isolate a production line, build a new tank and build a new feed system. That business itself is taking off quite well and it's really taking up a lot of my capacity. There's a wide range of customers and I'm not sure what their end uses are but there are some in the tubing market and a few are n Canada.”
The dozen employees at TekTube will transfer to Roscom.
“They are all being absorbed,” Quinn said. “That's one of the reasons we're bringing down the TekTube operation. One of the assets I need for Roscom is more employees so every single one of them has already stated to train on the Roscom side. It's really a big positive for us.”
