Mach Industries Pays $50 Million to Own Critical Solid Rocket Motor Capacity

Mach Industries said Tuesday it has bought solid rocket motor maker Exquadrum in a $50 million cash-and-equity transaction, folding the Victorville, Calif., plant and staff into a new business unit called Mach Energetics. The Huntington Beach–based defense startup said the acquisition gives it direct control over a component that has become scarce as unmanned systems scale, and positions the company to supply motors and related services to other defense firms.

The companies’ relationship began almost by accident. Executives say the introduction happened last fall after an Exquadrum client overheard a Mach recruiter at an MIT hiring event mention the firm was seeking a domestic solid motor supplier. Mach first became a customer, then moved quickly from buyer to owner, closing the deal roughly five months later and topping about eight other bidders, the company said.

Ethan Thornton, Mach’s founder and chief executive, described the purchase as a strategic step to tighten the company’s supply chain. Thornton, who left MIT at 19 to start Mach, told reporters the firm intends to integrate propulsion, radar, avionics and other systems to trim costs and cut delivery times. “If you can't secure the hardware you need, your production line stalls,” he said, adding that bringing manufacturing in-house shortens lead times and stabilizes pricing for fielded systems.

The timing reflects growing concern inside the Pentagon and industry over a narrow supplier base for solid rocket motors. Several major primes, including Aerojet Rocketdyne and Northrop Grumman, dominate domestic production, leaving little independent capacity to meet rising demand from drone and munition programs. In February, the Defense Department awarded Anduril about $44 million to expand U.S. production of solid motors, explicitly calling the item a chokepoint in munitions supply chains.

Mach said it will not only use the acquired capabilities for its own vehicles but will offer components, test services and subsystems to outside contractors. The deal brings roughly 85 Exquadrum employees, the company’s intellectual property and a 70,000‑square‑foot manufacturing site near an established propulsion test range into Mach’s operations. With the addition, Mach now counts about 350 workers. Exquadrum co‑founders Kevin Mahaffy and Eric Schmidt have taken leadership positions within the energistics unit, Mach said.

Analysts say the move is consistent with a trend among fast‑growing defense startups seeking to control more of their supply chains to compete on price and speed. Mach currently has five vehicle programs in development — a jet VTOL, a high‑altitude glider, an airborne sensor platform, a low‑cost counter‑drone interceptor and a long‑range strike munition — and expects to start production on at least three this year. “Owning the motor line can shave dollars off unit cost and remove a major scheduling headache,” said Laura Kim, a defense procurement analyst who follows propulsion markets.

Financially, Mach has raised nearly $200 million to date, including a $100 million Series B last June led by Bedrock Capital, Khosla Ventures and Sequoia Capital, and is valued at about $470 million. Investors and military buyers will be watching to see whether the integration improves margins and delivery timelines as Mach scales manufacturing for both its own systems and third‑party customers.