GAINES TWP. — Joining forces with its largest competitor will give Mobile Defenders LLC an opportunity to become part of the dominant player in the wholesale mobile device repair parts market with increased growth of scale.
Mobile Defenders co-founder, President and CEO Jordan Notenbaum reached out to Chantilly, Va.-based rival MobileSentrix in February to see if the company was interested in a possible acquisition.
“We had been talking to our ownership group and looking for a change,” Notenbaum told MiBiz. “(MobileSentrix) is just such a powerful in terms of their pricing and available of scale. I flew over and met with them and said, ‘Hey, let’s do a deal.’”
Both companies announced this week that they had completed a transaction in which industry leader MobileSentrix acquired Mobile Defenders, the second largest wholesale parts distributor in the sector. Terms of the deal were not disclosed.
MobileSentrix will retain all 45 of Mobile Defenders’ employees, including Notenbaum, who will remain as president of the company.
The two companies will independently operate and maintain their respective websites and identities.
Notenbaum said the two operations offered complementary products, with Mobile Defenders focused on developing relationships with major OEMs and MobileSentrix working directly with suppliers to offer a highly competitive pricing. Combining the two companies will give them better leverage to help drive down pricing for the industry, he added.
“We needed something to give back to our customers,” Notenbaum said. “It’s hard to compete with them in terms of pricing because we don’t have the import of scale. Now, we’re going to remain competitive and do something that’s industry-changing.”
The deal also provided liquidity for two of Mobile Defenders’ investors, which included an unspecified Fortune 300 company and a family office, he said.
As well, the sale did not include Mobile Defenders’ EduParts business, which has 20 employees and serves the K-12 education market. EduParts focuses on a different industry and market niche than the global business-to-business sector served by Mobile Defenders, which had been considered splitting off the business for some time, Notenbaum said.
According to a report from market research firm IbisWorld, the cell phone repair industry operates in a $4 billion market in the US alone as of 2022, with expectations of annual growth of about 1 percent. Nearly 9,300 companies repair cell phones in the US, which is the market both firms serve.
While the companies intend to maintain their separate brands and websites in the short term, they expect to begin leveraging each other’s strengths in the future, with Mobile Defenders bringing valuable OEM relationships with the likes of Apple, Samsung, Google, Motorola, LG, Dell , HP and others to the table for MobileSentrix. As well, Mobile Defenders works with mainly enterprise customers, while MobileSentrix focuses on serving the independent repair store network.
“Mobile Defenders has captive relationships with OEMs, and MobileSentrix hasn’t had relationships with any of them,” Notenbaum said. “The goal eventually is to integrate and sell OEM parts through Mobile Defenders and MobileSentrix. We’re also focused on, ‘Can we offer all OEM parts to all customers without having any red tape and requirements to go through?’ It’s really about being the voice of the customer.”
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