MALMO, Sweden—Hexpol Compounding Americas, a division of Hexpol Group, will close its rubber mixing facility in Kennedale, Texas, and divest its compounding site in Muscle Shoals, Ala., effective immediately.
The Muscle Shoals plant is being sold to private equity firm Karo Ventures L.L.C., a transaction that is expected to close in the fourth quarter of this year.
"Both decisions are certainly not a reflection of the skills or commitment of the Kennedale and Muscle Shoals work forces," said Gary Moore, president of Hexpol Compounding Americas. "We view these decisions necessary to maintain our competitiveness and to focus on our core business to improve our supply chain to support our customers most effectively."
Hexpol said the Kennedale site will close by the second quarter of 2025, and "all business from Kennedale will be relocated to other North American facilities."
"Hexpol Americas will work closely with customers to make sure the transition is seamless," Hexpol stated in a Dec. 13 news release.
Costs associated with the closure of the custom mixing production site will be accounted for in Q4 2024 financials, with little impact expected on net result, according the firm.
Hexpol also said it will monitor the transition in Muscle Shoals for associates and suppliers.
According to Hexpol, the Muscle Shoals site made products "outside of Hexpol's core business" with a profitability level below that of the overarching Hexpol Group. It posted annual sales of about $7 million, Hexpol said.
"These decisions are in line with our business model to focus on our core business, to optimize our efficiency and to support our customers most effectively," said Klas Dahlberg, president and CEO of Hexpol Group.
