Updated: Iron Mountain to buy Regency Technologies

Iron Mountain, a global information management, storage, data center infrastructure and information technology (IT) asset life cycle management firm, has entered into a definitive agreement to acquire IT asset disposition (ITAD) services provider Regency Technologies, headquartered in Stow, Ohio, for a sum of $200 million. The transaction is subject to customary closing conditions, but Iron Mountain expects the deal to close before year-end or in early 2024.

Iron Mountain says Regency Technologies, which is owned by Reserve Management Group, with headquarters in Stow and Chicago, has trailing four-quarter revenues that exceed $100 million.

The initial purchase price is $200 million, with $125 million to be paid at close, and the remainder due in 2025, which represents an approximate 7.5x multiple of earnings before interest, taxes, depreciation and amortization. The acquisition also features a potential performance-based earn-out, which would be payable in 2027. 

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The Regency purchase follows Iron Mountain’s purchase of ITRenew, an ITAD services provider based in Newark, California, from ZMC, which is a New York-based private equity firm. That purchase was announced in late 2021 and completed in early 2022 and formed the platform for Iron Mountain’s global ALM business.

Regency Technologies processes more than 55,000 tons of material annually, reselling more than 2 million units across its eight locations, which are in Stow; Austell, Georgia; Brooksville, Florida; Chicago; Grand Prairie, Texas; Olympia, Washington; Phoenix; and Durham, North Carolina. The company’s locations are R2, Recycling Industry Operating Standard (RIOS) and ISO 14001 certified and its clients include Fortune 500 corporations, government agencies, defense contractors and educational institutions.

In late 2019, Regency Technologies acquired the operations of Global Electric Electronic Processing Inc. (GEEP) USA and GEEP Costa Rica from the Toronto-based Giampaolo Group of Cos. GEEP USA had locations in Auburn Hills, Michigan, and Durham when it was purchased, while GEEP Costa Rica was located in Cartago.

“This strategic transaction represents a significant milestone in our efforts to strengthen Iron Mountain’s presence in the asset life cycle management sector and our sustainability offerings and will propel our enterprise growth forward,” says Mark Kidd, executive vice president and global general manager, Asset Lifecycle Management & Data Centers, at Iron Mountain. “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.”

In its third-quarter 2023 earnings call, Iron Mountain CEO William Meany said, “Regency will add operational scale as we continue our growth journey in this fast-growing sector. As the world's need for both secure and more circular solutions for end-of-life IT assets becomes more vital, we are pleased to add to our capability in this category.”

During the call, Iron Mountain Vice President and Chief Financial Officer Barry Hytinen said, “We've known Regency for years and have always been impressed with the strength of their team, range of capabilities and focus on sustainability, productivity and customer service. We see this acquisition as an excellent strategic fit furthering our ability to serve our expanding ALM customer base.”

Meany also noted that Regency is more extensively involved in downstream processing than Iron Mountain is presently, adding that this will allow Iron Mountain to harvest more value from the products that it is recycling and also allow it to accelerate and improve its expansion into original equipment manufacturer channels.

Kidd tells Recycling Today, "Regency will add operational capabilities as Iron Mountain continues growing in this rapidly expanding sector. As the world’s need for more secure and circular solutions for end-of-life IT assets becomes more vital, we are pleased to have the opportunity to add to our capability in this category."

He adds that Regency's leadership will remain with Iron Mountain after the purchase and be integrated into Iron Mountain’s ALM organization over a defined time period. "We recognize the value of the Regency’s leadership and believe their expertise and experience are essential for the continued success and growth of the business unit. The goal is to ensure a smooth transition for Regency’s employees, customers and vendors and to drive future success under Iron Mountain’s stewardship."