M&A: Iron Mountain Acquires Regency Technologies for ITAD Services

Iron Mountain has acquired Regency Technologies, a provider of IT asset disposition (ITAD) services in the United States. The purchase price was $200 million, and the valuation was roughly 7.5 times annual EBITDA (earnings before interest, taxes, depreciation and amortization), Iron Mountain said.

Iron Mountain, founded in 1951, is based in Boston, Massachusetts. The company specializes in information management, storage, data center infrastructure, and asset lifecycle management. The Iron Mountain partner program serves channel partners, real estate brokers and strategic alliances. Example alliances typically involve environmental, hardware, software and interconnection businesses.

Regency Technologies, founded in 1908, is based in Stow, Ohio. The company processes over 50,000 metric tons of material annually, reselling more than 2 million units across eight locations spanning the United States. An associated partner program serves OEMs (original equipment manufacturers), systems integrators, distributors, VARs (value-added resellers), MSPs (managed IT service providers) and IT consultants.

IT Asset Disposition (ITAD) Market: M&A Activity

Meanwhile, M&A activity in the ITAD market remains strong. Among the reasons: Annual spending on ITAD is expected to reach $34 billion by 2030, up from $16.8 billion in 2022, according to Research and Markets. That's a 9.2% compound annual growth rate (CAGR), the researcher said.

Also, key investors in the e-waste market include the Microsoft Climate Innovation Fund -- which backs Circular Services, a startup that's building and expanding recycling infrastructure across the United States.

Among the key business drivers for ITAD spending: The growing desire to reduce e-waste -- thereby keeping PCs, laptops, smartphones, printers, networking equipment and consumer electronics out of landfills.

Iron Mountain Acquires Regency Technologies: Purchase Price, Valuation and Executive Perspectives

Among the M&A deal's financial metrics to note, according to the buyer:

• Regency Technologies has trailing four quarter revenues in excess of $100 million.
• The initial purchase price is $200 million, with $125 million to be paid at close and the remainder $75 million due in 2025.
• The $200 million figure represents an approximate 7.5x multiple of EBITDA.
• The acquisition also features a potential performance-based earn-out, which would be payable in 2027, if earned. Those financial figures and the potential EBITDA multiple were not disclosed.

In a prepared statement about the deal, Mark Kidd, EVP & global general manager, Asset Lifecycle Management & Data Centers, Iron Mountain, said: “This strategic transaction represents a significant milestone in our efforts to strengthen Iron Mountain’s presence in the Asset Lifecycle Management sector and our sustainability offerings, and will propel our enterprise growth forward. Regency seamlessly complements our expanding ALM business, bolstering it with robust remarketing and recycling capabilities to better serve the world’s largest and most innovative companies and help them achieve their environmental and data security goals.”

Added Jim Levine, CEO of Regency Technologies: “We are excited to add Regency’s extensive experience of over 20 years, during which we’ve successfully served enterprises, government entities and retailers, to Iron Mountain’s already impressive customer portfolio, which includes 95% of the Fortune 1000. By integrating our presence, remarketing expertise, and recycling operations into Iron Mountain’s ALM business, we’ll be uniting a broad array of capabilities, further solidifying our leadership in the market.”

IT Asset Disposition (ITAD) Partnership Trends

Customer demand is driving new ITAD partnerships and software development efforts. Example moves in in recent months include:

• Dynamic Lifecycle Innovations and global IT distribution giant TD Synnex are working together to help channel partners and customers achieve ESG goals, while driving reuse or recycling of IT equipment.
• ScalePad, an MSP software provider, has expanded its IT Asset Disposal software to cover a "broader range of asset types." The effort includes "full-service bulk disposal support, and is cost-free with no hidden fees or shipping charges," ScalePad said. CEO Dan Wensley has worked in and around the MSP software market for more than two decades.

More Companies, Experts to Know

Meanwhile, seven ITAD companies are listed in our Sustainability Partner Programs Database. Examples include:

• DMD Systems Recovery;
• HPE Partner Ready Vantage;
• Ingram Micro ITAD and Ingram Micro Lifecycle;
• Iron Mountain Partner Program;
• Sage Sustainable Electronics Partner Program
• ScalePad Lifecycle Manager; and
• Shyft Multi-Vendor Solution, part of TD Synnex

If you're seeking to get started in the ITAD market, key advisors include Todd Zegers, president of Circular Integrity, based in Newport Beach, California. Zegers has worked in and around the e-waste and ITAD markets since 2003 or so. We'll share more about Zegers and Circular Integrity in the weeks and months ahead.