NEW YORK (Reuters) - The U.S. unit of Transmar Group Ltd has filed for bankruptcy protection just weeks after the parent company's European operation declared insolvency following "unfavorable" cocoa contracts and British pound fluctuations, court filings showed.


Transmar Commodity Group Ltd, which sells cocoa products to major chocolate makers including Hershey Co <HSY.N> and Nestle <NESN.S>, voluntarily filed Chapter 11 bankruptcy to the Southern District of New York United States Bankruptcy Court on Dec. 31.


Transmar Group is a major buyer and processor of cocoa beans with operations in the United States, Europe, South America and West Africa.


The U.S. subsidiary plans to operate throughout the proceedings, said Robert Frezza, chief restructuring officer for Transmar, in a Jan. 3 court filing.


The filing came shortly after Transmar Group's European operation Euromar Commodities GmbH, a German cocoa grinder and significant customer to the U.S. company, declared insolvency in early December, adding to Transmar Commodity Group's financial distress, Frezza said.


Transmar Group's rapid expansion, which continued as recently as 2015, combined with volatile cocoa prices caused problems, Frezza said, pointing to difficulties integrating their infrastructure and corporate governance.

Euromar, an indirect subsidiary of Transmar Group, has been one of Transmar Commodity Group's primary customers of cocoa products, with sales volumes increasing significantly between 2013-2015, the filing said.

"During this time of high growth at Euromar, Euromar entered into various unfavorable forward purchase contracts, including certain unhedged forward contracts, which resulted in enormous losses for Euromar when the price of cocoa in the market moved in ways that Euromar had not anticipated," Frezza said.

Another source of pressure for Euromar came after the United Kingdom voted in June 2016 to leave the European Union, causing fluctuations in the pound <GBP=>, the currency that much of the world's cocoa is traded.

Transmar's filing showed an estimated number of creditors of 200-999, and estimated assets between $100 million to $500 million.

(Reporting by Marcy Nicholson; Editing by Alan Crosby)