Not every family-owned business moves into the hands of the next generation. This leaves current ownership a new and different future for the company. That was the case for Pedricktown, N.J.-based J.E. Berkowitz (JEB), which announced last Thursday that it had sold a majority interest in the company to Consolidated Glass Holdings (CGH), a Grey Mountain Partnership affiliate company consisting of a number of glass industry companies.
Arthur Berkowitz, executive vice president of JEB, is the company’s third generation owner/manager, leading it for more than 40 years. In the announcement last week, Berkowitz stated, “CGH and Grey Mountain were the correct fit for me and my employees. As part of my succession planning, this step permitted me to keep an ownership position and retain the real estate. I will remain energized and committed to managing the operations at JEB for years to come.”
In an exclusive interview, Berkowitz spoke with USGlass magazine editor Ellen Rogers to provide background on the acquisition and why this was an important move for his company. He also shared some insight on his future hopes and plans for JEB.
ER: Tell me about the announcement that JEB is now part of Consolidated Glass Holdings. What was the background to this?
AB: The background was in early 2015 when my Dad was still alive and chairperson we came to a conclusion that, from a succession standpoint, there would not be a fourth generation family member involved or managing the business. I have three talented children and several nieces and nephews who are successful in their chosen careers and none were interested or expressed the desire to enter this business. We have a board of advisors and reviewed with them and the recommendation was made to hire a third party (an investment banker) to look at different options.
One of the options was the sale of the company. We had others as well, such as ESOP; going out and recruiting a non-family member to be general manager, etc. We chose to explore the sale of the company and began that process in early 2016, managed by the investment banker. They found six interested companies that we had initial meetings with and reviewed proposals in the first quarter of 2016. Within those six there were two classifications: private equity and strategic partnerships. We narrowed that list down to two, both private equity, and in early August we entered an exclusive agreement with one candidate and 90 days later we made the announcement that we completed a transaction with Grey Mountain Partners, which has a portfolio group called Consolidated Glass Holdings. The transaction involved me keeping an equity position going forward, our family keeping the real estate and my current position in managing operations in Pedricktown, N.J.
ER: Going forward what does this mean for the industry—employees, customers, suppliers …
AB: That goes back to the original succession planning and it was important to my father and to me that the company continue to operate for years to come. To provide great employment, wages and benefits for our people and to continue our focus on high-quality, added-value, architectural glass products. That’s our mission and the commitment I have with Grey Mountain and CGH. This sets the foundation for our company for years to come, a path and understanding for our employees, customers, suppliers, and the industry that we remain focused on our mission.
There is always anxiety associated with change. My greatest task was to manage the anxiety of our employees and customers and suppliers–they are our life blood and I hope I’ve done an effective job in managing the anxiety of change. I hope this will be a good change.
ER: Is there anything else you’d like our readers and those in the industry to know about this change?
AB: Personally, I am still excited and passionate about my company, its employees and the industry. I feel I have a lot to contribute and hope to be here for years to come. I will continue to stay active in the industry, in GANA and Centric. From a business standpoint, our mission and focus of being a premier, high-end architectural glass fabricator is undiminished and I plan to make sure we stay strong in this area and continue to grow our platform.