Bankruptcy court approves new home for ‘Homz' products company

A Chicago plastics storage container maker will resume operations under new ownership following an 11th-hour deal just days before the equipment was scheduled to be auctioned.

Home Products International Inc. had shuttered two plants at 4501 W. 47th St. and 5507 S. Archer Ave. earlier this year under the continuing weight of high resin prices that forced the company to seek shelter through bankruptcy court. But i2Poly Inc. has stepped in to purchase assets of HPI, which owns the Homz brand of products, for $4.7 million, according to a July 12 filing in U.S. Bankruptcy Court in Chicago.

The deal includes 348 molds and 78 injection molding machines, mostly made by Milacron, with clamping forces ranging from 440 to 2,200 tons. That equipment has been used to make a variety of totes, tubs, carts and storage products.

When news first broke earlier in July that i2Poly was interested in acquiring the company's assets before they were auctioned off, a bankruptcy court filing indicated the buyer was willing to pay $5 million for equipment located at two sites as well as resin and the inventory of finished goods.

Bankruptcy court documents filed July 12 indicate the final purchase price ended up at $4.7 million, a number still higher than the $3.8 million HPI had anticipated from an auction.

It was in early June that HPI filed for bankruptcy court protection, indicating the company had been unsuccessful in finding a buyer. HPI, which also made ironing boards, found itself at the end of its financial rope and blamed rising raw material prices.

HPI Chief Financial Officer James Auker, in a previous court filing, indicted input material costs have been extremely volatile during the past two years, with resin prices doubling and steel prices tripling.

"The debtors have had only moderate success passing along those price increases to its customer base," he said.

"The debtors will receive significantly more value from this sale than they were likely to get from the auction, and they will receive the funds within a few days of the sale being approved and the closing occurring," Auker said in one court filing.

"It is my understanding that the buyer may offer employment to a number of the debtors' former employees and seek to enter into new contracts with a number [of] the debtors' vendors, which would benefit the community," he continued.

The purchase by iPoly2 does not include machinery, equipment or real estate at HPI's Seymour, Ind., facility where the company made ironing boards. HPI, in March, said it was closing the ironing board site to focus on plastics.

Both plastics locations in Chicago are leased, and the new owners are expected to move forward at one site.

"Buyer has informed seller that buyer intends to enter into a new, post-closing lease for the 47th Street facility with the landlord," a court filing states. "Buyer has informed seller that buyer has no intention of leasing the Archer facility after the closing date. Accordingly, seller intends to reject the Archer facility lease at some point following the closing date."

The new owner also was expected to reject a contract with unionized workers at HPI as part of the purchase but is signaling a willingness to move forward with unionized workers.

"Buyer will likely make offers of employment to certain former union employees on terms and conditions set by buyer, and buyer will recognize and bargain with the union to the extent required by National Labor Relations Act," a court filing states.

HPI officials previously indicated that 146 workers at the Chicago facilities would be laid off starting May 20. More than half of the company's workers had been with the firm for more than 10 years, according to a video on the company's website.

HPI's original bankruptcy court filing indicated that between 200 and 999 creditors were owed at least $50 million. The company listed assets valued at between $10 million and $50 million. Customers for the company's totes, carts and bins included Walmart, Target and Amazon.

The bankruptcy court filing approving the sale lists 229,285 pieces of inventory covering hundreds of different products.

The owner, i2Poly, is owned by Pennsylvania businessman Christopher Hackett, who also owns i2M of Mountain Top, Pa., a maker of decorative and performance films. Hackett could not be reached for comment.

Aside from Homz, other brands owned by HPI include Durabilt, Eco Storage and Homz Commercial Products.