HUNTINGTON BEACH, CALIFORNIA — Mach Industries has acquired solid rocket motor startup Exquadrum in a $50 million cash-and-equity deal, rebranding the company as Mach Energetics and folding it fully into its operations. The Huntington Beach, California-based defense startup, founded three years ago, beat out more than eight other potential buyers to complete the purchase.

The deal includes all 85 Exquadrum employees, the company's intellectual property and business lines, and a 70,000-square-foot facility in Victorville, California, anchored by a nearby energetics and rocket propulsion test site. The combined company now has roughly 350 employees. Exquadrum co-founders Kevin Mahaffy and Eric Schmidt are taking on leadership roles within Mach Energetics and Mach Industries.

"The Exquadrum acquisition marks an important next stage in Mach's growth. As we deliver vehicles to the warfighter, we'll continue to vertically integrate our supply chain across solid rocket motors, engines, radar, and avionics to ensure we deliver the best possible product at the lowest cost," said Ethan Thornton, founder and CEO of Mach Industries.

The acquisition gives Mach Industries direct control over solid rocket motor components for modern unmanned systems. Mach first became a customer of Exquadrum before acquiring the company, with the deal closing roughly five months after initial contact. In September, an Exquadrum customer at an MIT recruiting event overheard a Mach recruiter saying the company was seeking a solid rocket motor supplier.

Decades of consolidation have left the domestic solid rocket motor market effectively controlled by Aerojet Rocketdyne and Northrop Grumman. The Pentagon has described solid rocket motors as a critical bottleneck in the munitions supply chain, and in February awarded defense tech company Anduril $43.7 million to expand domestic production. Mach Energetics plans to sell components, testing services, and subsystems to other defense firms.

Mach Industries has five vehicle programs in development: Viper, Glide, Stratos, Dart, and Pike. The company plans to enter production on at least three of those programs this year, and said the acquisition improves unit economics across its vehicle programs as it begins scaling production.

Thornton dropped out of MIT at age 19 to start Mach Industries. The company has raised nearly $200 million in total and is valued at $470 million. In June, it closed a $100 million Series B funding round led by Bedrock Capital, Khosla Ventures, and Sequoia Capital.