Worley & Obetz closes
Worley & Obetz - once one of Central Pennsylvania's largest private companies - has closed.
After 72 years in business, the energy company closed its doors yesterday.
The news was first reported yesterday by LNP. A "closed" sign on the door of the company's headquarters Tuesday morning appeared to confirm the shutdown. Efforts to reach the company's vice chairman, Seth Obetz, were not immediately successful.
The closure comes amid news that the company is being investigated for fraud related to a former executive.
Despite its troubles, the company believed it might be able to persevere.
In a Facebook statement posted Saturday - and still available on its website - Worley & Obetz said it had a "solid plan to keep the company going despite the recent closure of the commercial fleet side of the business."
Approximately 150 people are now out of a job in addition to the 105 people the company laid off last month, but at least one other local energy company has said it may be able to hire some of them.
On its Facebook page, York-based Shipley Energy said it had open positions for commercial drivers, customer service reps and others.
"The local energy industry is a small community, and we want to do everything we can to help when others need it," Shipley wrote. "If you or someone you know has been impacted by a layoff from Worley & Obetz, Inc, we want to help."
Worley & Obetz did not report revenue for 2016, but in 2015 it said its sales totaled $520.53 million, enough to make it No. 6 on the Central Penn Business Journal's list of Top 100 private companies, ranked by revenue. It also was listed among this newspaper's fastest-growing companies.
Founded in 1946, the company provided a range of fuels and HVAC services to residential and commercial customers. The company also operated a convenience store, called Molly's and located near its headquarters.
A fourth bank entangled
A fourth bank, meanwhile, has reported future losses potentially related to the troubles at Worley & Obetz.
In a filing with the U.S. Securities and Exchange Commission, S&T Bancorp Inc. said it is exposed to a credit loss "arising from a participation loan agreement with a lead bank and other participating banks, all of which extended multiple credit facilities to a single, large commercial customer."
S&T did not identify the customer, nor did two other banks that reported similar exposure: Fulton Financial Corp. and Univest Corp. of Pennsylvania. But a third, Franklin Financial Services Corp., referenced to Worley & Obetz in its filing.
S&T said its share of the loan was $4.9 million and further exposure of $950,000 secured by vehicles and equipment liens. The bank, based in Indiana County, said it expected a loss of between $4.5 million and $5.4 million.
"The loss resulted from fraudulent activities believed to be perpetrated by one or more executives employed by the borrower and its related entities," S&T said in its filing. The disclosure was first reported by American Banker, a news outlet covering the banking industry.
The loan itself appears to have totaled about $80 million, with Fulton holding $48 million.