Broadband Construction Component Manufacturer Available for Acquisition
Midwestern United States
3-Year Average Sales $410,000 EBITDA $155,000
Sale Price: $820,000
Originally founded in 2005, this patented product makes the installation of Outside Plant (“OSP”) much quicker, more predictable, more economical and allows a smaller installation footprint. It also reduces the ongoing costs of operating the OSP.
The system is widely used by telephone utilities in building fiber to the home (“FTTH”) networks. The system was developed in response to requests for a product from consulting engineers in telecom. It was the first such product accepted by the Rural Utilities Service, a branch of the Department of Agriculture that provides funding for telecom projects carried out nationwide.
The business has been family-owned since its beginning and enjoys deep relationships with customers in the area. It boasts an outstanding reputation for quality and its brand name is regionally known. It is sought by major customers due to its ability to deliver a high-quality product on a timely basis. This product line could be a stand-alone business, or an addition to a business with other products in production. Because it does not rely on in-house production personnel, a single individual could operate it.
- Well established product has been accepted in market for number of years;
- Patented product;
- Strong supplier relationships;
- Relationships with large distributors;
- High profit margins;
- Very simple business model;
- High-growth industry;
- Easily relocatable.
Potential improvement to the Business as identified by the Seller could be as follows:
- Adding product to existing product line can quickly increase sales and distribution.
- Providing manufacturing and distribution capacity can increase margins.
- Ability to have engineers and architects spec product can yield multiple new sales opportunities.
- Potential to penetrate markets outside Midwest.
- Infrastructure spending initiatives by federal, state and local governments provide large stimulus;
- The FCC has the ability to propose and enforce rapid broadband development in rural areas.
- Penetration of a large Tier I or Tier II provider would provide explosive growth opportunities.
- Establishing a distribution agreement with a large distributor to provide marketing and sales.
- Smaller telco’s have accounted for rapidly expand growth share. Opportunity to market directly.
- Aggregate private investment from corporations will continue to rise, increasing demand for more sophisticated networks.
- Strong domestic demand for fiber-optic cable networks will boost industry revenue.
- Improving incomes and heightened demand for fiber-optic cable will support industry revenue.