Closed transaction · January 2014
Rackmount Solutions
MDR & Associates took Rackmount Solutions, a server rack manufacturer, through to closing in January 2014.
The transaction
- ClosedJanuary 2014
- SectorManufacturing & industrial
- LocationAllen, Texas
- BuyerAn individual buyer: a former MetroPCS executive
- Engagement to closing120 days
- Represented byMDR & Associates
The sale
How it ran
Rackmount Solutions supplies server racks, cabinets, wall-mount and network racks and portable rack cases to the IT industry, and had been listed among the fastest-growing companies in the country four years in a row.
In January 2014 we sold it to Bogey Free, LLC, whose owner had been a senior executive at MetroPCS.
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Get a free valuation snapshotWhat decided the price
What buyers look at in a manufacturing company
Adjusted EBITDA, not revenue
Earnings are recast to remove owner compensation above market, personal expenses and one-off items. Every add-back needs a paper trail, or a buyer strikes it out.
Equipment condition and age
A buyer prices the capital expenditure they will face in the first three years. Deferred maintenance comes straight off the offer.
Real estate, in or out
Owning the building can raise the total consideration, and it can also complicate the deal. It is usually cleaner to sell the operating company and lease the property back.
The full list, and who the buyers are: Selling a manufacturing company in Texas.
Your company
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- A value range and what is driving it
- An honest answer about whether now is the time to sell
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