First Reserve is buying Ameriforge Group Inc. from Post Oak Companies, an affiliate of Tanglewood Investments. Terms of the deal were not released. Ameriforge is a manufacturer of subassemblies and integrated systems for the oil and gas, aerospace, transportation and industrial markets. The deal is expected to close in December.
First Reserve Corporation (“First Reserve”), a leading global investment firm dedicated to the energy industry, and Tanglewood Investments Inc. (“Tanglewood”), a Houston based private equity firm focused on equipment manufacturing firms serving the energy industry, today jointly announced that First Reserve Fund XII, in partnership with Ameriforge’s management, has agreed to acquire Ameriforge Group, Inc, (“Ameriforge”) from Post Oak Companies LP, an affiliate of Tanglewood. Financial terms of this transaction were not disclosed. The transaction is subject to certain regulatory approvals and is expected to close in December.
Ameriforge is a leading, vertically integrated manufacturer of highly engineered products, subassemblies and integrated systems for the oil and gas, midstream, downstream, power generation, aerospace, transportation and industrial markets. The executive management team will remain in place and will retain an equity interest in the company. In addition, the three founders and principals of Tanglewood will be continuing equity investors in Ameriforge.
Gean B. Stalcup, CEO of Ameriforge commented, “First Reserve’s investment represents a key milestone for our company. During our partnership with Tanglewood, we were able to transform Ameriforge from a single location flange forging company focused on the North American market to a fully-integrated, 29 facility international manufacturing enterprise which is providing a growing array of highly technical products and related services to the global energy, aerospace and transportation industries. We believe our business model is uniquely poised for continued significant growth and could not be more pleased that we are beginning a new partnership with First Reserve. Our management team is highly confident that First Reserve’s experience and knowledge in the energy industry will assist us as we continue to grow our suite of products and related services to better serve our customer base around the world. We will also benefit substantially from First Reserve’s industry knowledge, financial strength and deep experience in providing companies like ours effective access to growth capital. Finally, I’d like to offer my personal thanks to the team at Tanglewood for their enduring support, to our employees for their tireless efforts in creating this enterprise and to our customers whose continued trust in our products and services has fueled our growth and success.”
Jeff Quake, Managing Director of First Reserve said, “We are excited to partner with this highly talented management team and support their continued investment in innovative technology-led product solutions. We believe Ameriforge’s best-in-class manufacturing capability positions them well to participate in several of our core themes including international subsea development, the application of technology to extract unconventional resources and continued growth in recurring after-market related services.”
Michael L. Tiner, Managing Director of Tanglewood and current Chairman of Ameriforge Group added, “My two partners at Tanglewood and I could not be more pleased with this transaction. We are strong believers in the future of Ameriforge and have affirmed that conviction by our continuing personal investments in the company alongside First Reserve. I very much look forward to continuing my relationship with Ameriforge as a member of its Board of Directors. The time had come for Ameriforge to seek a larger and more capable financial partner in order for the company to realize its full potential. First Reserve is an ideal fit in every respect to be that partner.”
Harris Williams & Co. is acting as the exclusive advisor to Ameriforge.
About Ameriforge Group, Inc.
A privately-held Houston-based company with a global footprint across 29 facilities in five countries spanning four continents. Ameriforge Group provides a range of highly engineered products, including turnkey solutions such as drilling risers and gas turbine combustors, subsystem components such as drill riser assemblies, production riser assemblies, BOP assemblies and buoyancy modules, and individual parts such as machined and fabricated products. The company also further supports its diverse customer base through providing a variety of complementary aftermarket services.
About First Reserve Corporation
Founded in 1983, First Reserve is a leading global investment firm dedicated to the energy industry with over $23 billion of raised capital since inception. With offices in North America, Europe and Asia, First Reserve is well-positioned to make strategic investments on a global basis across the energy value chain. First Reserve seeks to create value for its investors by applying its deep industry knowledge, decades of investing and operational experience, highly talented management team and powerful network of global relationships to its investments and through active monitoring of its portfolio companies. For additional information, please visit First Reserve’s website at www.firstreserve.com .
About Tanglewood Investments Inc.
Tanglewood Investments Inc., located in Houston, Texas, is a private equity firm with a focus on growth through innovative strategies and operational excellence founded to address the need for equity capital and management expertise in established middle market equipment manufacturing companies serving the energy industry. Since 1997 approximately $75 million of equity capital has been invested through affiliates of Tanglewood and, pro forma for completion of this transaction, approximately $675 million will have been returned to Tanglewood’s investors. In addition, an affiliate of Tanglewood continues to own one remaining portfolio company that is attributable to its original investor group.