The owner of one of Pennsylvania's largest underground coal mining companies and a beloved Pittsburgh brewery has taken a majority ownership stake in Oberg Industries Inc.
Freeport-based Oberg is a full-service contract manufacturer of precision machined and stamped components.
Forrest is president of Kittanning-based Rosebud Mining Co. In January, he acquired Pittsburgh Brewing Co. from Verus Investment Partners, a New York private equity firm.
In a release, Eric Oberg described the transaction as a "significant and positive step forward for the employees and customer partners" of Oberg.
"Cliff's passion for his businesses and employees aligns perfectly to the culture we have built at Oberg over the past 70 years," he added. "His successful business experience and availability of capital will position Oberg for its next phase of growth."
Terms and details of the transaction were not disclosed publicly, and Eric Oberg and Forrest informed Oberg employees at its Freeport and Sarver locations on Tuesday. The company said no management changes are planned and that the new partnership "will enhance our leverage for capital and growth."
The investment was made through Forrest's family office, Western Allegheny Capital, which is managed by Wexford-based Tecum Equity Partners. Law firm Jones Day served as counsel to Western Allegheny and Tecum Equity Partners. Debt financing for the transaction was provided by Citizens Bank and S&T Bank.
"David Bonvenuto, Oberg's president and CEO, and I started our careers together at (accounting firm) KPMG and kept in touch," said Stephen Gurgovits Jr., Tecum managing director. "Over the past four years, we've talked on and off about how we could do business together, but given the growth at Oberg and the great job the management team has done, we didn't have an investment vehicle that would have fit their profile."
Tecum has an SBIC fund, through which it can bring matching dollars from the U.S. Small Business Administration, but last year, it added a separate entity, an equity control buyout fund with a committed initial pool of $50 million backed by Western Allegheny Capital.
"Dave approached me that Eric Oberg was considering a transition of some sort at some point to diversify his assets, we had some conversations and it's a very good fit," Gurgovits said. "At the end of the day, Eric is involved, we bring in Cliff and there's Tecum as an adviser at the board level, working with management to find ways to continue to grow the business, organically and through acquisitions, which is our bread and butter."