- Month: January 2024
- Category: Acquisition
CS Analysis: The first acquisition transaction is that of Sadoff Iron & Metal Company taking over SunCoast Communications. Sadoff is in the business of acquiring electronic material for its recycling operation. And SunCoast Communications supplies new, used, and refurbished telecommunication and networking equipment. SeunCoast says all its equipment is either unused surplus, tested, or pulled from a working environment, generally within telecom and carries infrastructures. Some of SunCoast’s sources of supplies are Verizon and AT&T, T-Mobile, and so the focus is not so much on PCs and general IT equipment, but on communications systems. Over the past years. Sadoff acted as a partner for SunCoast by being its downstream and materials broker for the e-waste that SunCoast generates. The two companies see no overlapping functions or businesses but recognize, as such, the synergies the two have. One being a supplier (origination) and the other being a recycling operation. This acquisition is likely to have a more direct positive impact on the two companies. The transaction adds additional capabilities to grow organically, although moderately, since Sadoff will expand its presence beyond Wisconsin and Nebraska to Dallas and Maryland, hence creating opportunities beyond the usual geographies the company has been servicing. From a capacity perspective, Sadoff appears to be the biggest of the two, with an estimated employee base of 300 (best CS estimate), and an approximate revenue of $30 million. These figures have not been confirmed and so they represent the best estimate as of January 2024. SunCoast Communication is most likely a much smaller entity, boasting lower worker count and revenue figure.
Press Release:
SunCoast Communications has long been a supplier of electronic material for our electronics recycling side of the business. Over years of business together, we have decided to make our partnership even stronger. In September, Sadoff submitted a letter of intent to purchase SunCoast. Shortly after, SunCoast signed the letter and now the acquisition is being made official.
What Does That Mean for Sadoff and SunCoast?
What made this acquisition so attractive to us is that though our businesses run in parallel, there isn’t a lot of overlap in what both of our companies do. Instead, there are a lot of areas where we can augment each other so that we can both serve our industries and our clients better.
Who is SunCoast Communications?
SunCoast Communications is the premier supplier of quality new, used, and refurbished telecommunication and networking equipment. All equipment is either unused surplus, tested, or pulled from a working environment. SunCoast offers solutions for every phase of telecom and carries the industry’s leading manufacturers. Some of SunCoast’s working partners include Verizon, AT&T, T-Mobile, and other large players in the telecom space.
Where Our Story With SunCoast Began
We are not acquiring SunCoast by accident, but our paths first crossed almost by accident. Sadoff is a member of the Terra Network which is a national electronics company collective. Terra approached us 3 years ago to recycle telecommunications radios. Matt Weirman from Sadoff was able to leverage an existing relationship and that’s how we began working with SunCoast. Since then, we have become a qualified downstream and materials broker for the e-waste that SunCoast generates. In April of this year, we were approached by SunCoast’s largest shareholder about owning a part of their company. It didn’t take long for us both to see the synergies that both of our companies could provide to each other. SunCoast was also in need of capital to continue with its growth plan, and we were excited to be a part of it. Now we can provide the tools and the capital that will allow SunCoast to continue its dynamic growth strategy.
What the Future Holds for Sadoff + SunCoast
When it comes to the future, we couldn’t be more excited. If you are a Sadoff client or a SunCoast client, you can continue to expect the same great nationwide service that you have grown accustomed to. With our Sadoff locations spread across Wisconsin and Nebraska and now our SunCoast locations in Dallas and Maryland, our combined footprint will be larger than it ever has been before. In the coming months, we are excited to learn even more about how SunCoast operates and where we can find further synergies between our two companies. We believe that with an effective combination of our electronics recycling business and their telecom materials company, we will both come out on top with a strategic advantage in the telecom marketplace.
Link: https://sadoff.com/news/sadoff-acquires-suncoast-communications-phc/