Situation:

National Power is an exclusive distributor of Generac industrial and commercial generators, batteries and other essential power components. In addition, the Company provides critical infrastructure services nationwide to major cable and telecom companies including:

• Turnkey building solutions to accommodate additional server rack space, upgraded power supply/AC panels, and changing from single-phase to three-phase power;
• Installation of DC power plants along with rectifiers and battery backup for N+1 to 2N redundancies;
• New fire protection systems;
• Technical advances involving fiber deep.

Ameridan’s Role:

Ameridan was engaged by a private equity group to perform market & customer diligence. The scope of the project was focused on five key areas:

• Factors affecting overall capital expenditure trends in the US telecom industry and the implications on demand for National Power’s cable headend facilities-related products/services;
• The Company’s competitive position in its regional markets;
• Customer views regarding National Power’s overall value proposition, strengths & weaknesses, service levels, installation/product quality, technical knowledge, customer service, and other relevant factors;
• National Power’s relationship with top customers including overall stickiness, share of wallet, growth potential, and medium-term revenue expectations.
• Key investment risks, including issues surrounding potential changes in technological/regulatory requirements, and other issues as identified over the course of the engagement.

As part of this diligence project, Ameridan conducted interviews with National Power’s customers, competitors, and other market participants.