Tecum Capital Announces Growth Investment in DelGrosso Foods
July 7, 2021
Pittsburgh, PA – Tecum Capital Partners II, L.P. (“Tecum”) is proud to announce its newest investment in DelGrosso Foods Inc. (“DelGrosso” or the “Company”). Tecum partnered with a local banking syndicate led by First Commonwealth Bank to provide debt financing to support the second- and third-generation leadership team in the Company’s next stage of growth. DelGrosso is a leader in the formulation and manufacturing of premium tomato-based sauces, including pasta sauces and salsas.
Founded in 1947, DelGrosso is the oldest family-owned manufacturer of pasta sauces in the United States. The Company specializes in the formulation and manufacture of branded, private label, and co-manufactured tomato-based sauces. The company excels in developing custom recipes and manufacturing high-quality products at high volumes for the largest domestic grocers and consumer packaged goods companies. DelGrosso currently operates a 130,000 square foot manufacturing facility located in Tipton, Pennsylvania, and is utilizing the growth investment to fund the conversion of a recently acquired 166,000 square foot vacant facility located in Antis Township, Pennsylvania. The expanded manufacturing space, which will include a new sauce manufacturing line, will allow the Company to more than double its production capacity. In addition to preserving 90+ jobs at the Company’s Tipton facility, the investment is anticipated to create over 50 new manufacturing jobs in Antis Township at the new facility.
“We’ve made numerous additions to our existing Tipton sauce plant over the decades, adding warehousing space and expanded production capacity where we could. In order to continue to grow, our only option at this point is to add a second facility,” said second-generation family member and CEO Joe DelGrosso. “It’s the largest step in the history of the family business since my parents packed those first cans of sauce over 70 years ago.”
“We have a highly dedicated, world-class workforce right here in Blair County that produces DelGrosso branded products for distribution nationally and internationally, packs private label (store brand) products for half of the top 20 grocers in America and produces sauce or salsa for several national brands. We are excited for the next step,” said third-generation family member and Chief Sales and Marketing Officer Michael DelGrosso.
Stephen Gurgovits, Jr., Managing Partner of Tecum, stated, “DelGrosso represents another opportunity to partner with a passionate and proven management team alongside an experienced senior lending syndicate right in our back yard. Further, we are very bullish on the co-manufacturing industry within durable food product categories around the country and we believe DelGrosso to be a world-class food co-manufacturer. In addition to supporting the management team, we could not be happier to have the ability to support regional job growth, as it is a core part of Tecum’s investment strategy.” Matt Harnett, Partner of Tecum, added, “The historical durability of the business, along with current organic growth initiatives and industry tailwinds gets the team excited. Tecum is thrilled to partner with DelGrosso in its next phase of growth.”
The Deal Team from Tecum consisted of Matt Harnett, Sean Edmonson, Ian Frazier, and Matt Sweet.
First Commonwealth Bank, S&T Bank, Tri-State Capital Bank, Somerset Trust Company, Reliance Bank, and Washington Financial Bank provided senior debt financing.
About Tecum
Tecum Capital is a Pittsburgh, Pennsylvania based investment firm deploying private capital in lower middle market companies. Tecum provides mezzanine debt and equity investments in growth-oriented middle market companies across the broader high-value manufacturing, value-added distribution, and business services sectors, with a focus on opportunities that demonstrate strong long-term industry fundamentals, differentiated products or services, and identifiable secular growth tailwinds. Our team partners with independent sponsors, family offices, committed funds, business owners seeking succession plans, and management teams to create shared success. Tecum focuses on businesses with EBITDA greater than $3 million. Tecum seeks to invest $5 million to $20 million in potential portfolio companies. Tecum is a licensed Small Business Investment Company (“SBIC”) and is currently investing out of Tecum Capital Partners II, L.P, a $265 million fund launched in June 2017. Since 2006, the team has collectively invested more than $750 million in over 100 platform and add-on acquisitions. For more information, please visit www.tecum.com.