MASSENA — International Consolidated Companies Inc. announced Monday that it filed a letter of intent to acquire the assets of Source Bio Plastics, which created a partnership with the Michelex plastics division in March.

The deal between Michelex — a company that manufactures CD and DVD cases here — and the Bethesda, Md. company was worth $5.7 million.

The letter of intent is the next step in creating a company that will manufacture biodegradable plastics. It will bring at least 175 jobs to Massena initially, according Robert F. Rood, the president of Source Bio Plastics. Source Bio Products will in time increase production to three shifts a day, seven days a week, bringing even more jobs to the area.

The venture has been offered a $4.5 million incentive package from Empire State Development, including a $1 million loan, according to spokeswoman Stefanie Zakowicz. The new company will receive the loan after completing the goals set before it by the ESD. Those goals include creating 175 jobs and maintaining them for two years. The new hires must be completed by 2012.

Michelex has been in Massena for nearly 40 years.

"It is great to achieve this opportunity for an important division of our company and to be able to give back economically to our community and the state of New York, both of which have supported us for many years," Thomas G. Gramuglia, president of Michelex, said in a statement.