maybe a close up photo would help - I can think of three things.
1. rodent damage - mice love to chew on stuff like that. but the chewed area looks smaller/finer than a rodent could do
2. insect damage - but I don't know what kind of insect could/would chew up that kind of synthetic material
3. chemical damage - I wonder if some kind of solvent spilled on it or something that dissolved the material.
actually, I'm not sure what that handle is made out of - is it synthetic or wood or bone? if wood or bone, then most likely insect damage.