Market insight – The equipment-as-a-service (EaaS) industry

Mergers and acquisitions (M&A) activity in the equipment-as-a-service (EaaS) industry is showing strong momentum.

• The global EaaS market size was valued at $86.57bn in 2024. It is expected to grow from $94.87bn in 2025 to $216.16bn by 2034 at a CAGR of 9.6%.
• North America dominated the global EaaS market in 2023, accounting for 36.7% of market share. In Europe, Germany held a share of more than 33%.
• The UK’s move towards productivity improvements in construction, the need to replace ageing machinery with greener options, and ongoing labour shortages all support the EaaS model.

What is the EaaS industry?

This sector comprises companies which provide physical equipment to customers on a subscription or pay-per-use basis, rather than selling it outright. That approach shifts a capital expense to an operational cost, allowing customers to access the latest technology without the need for large upfront investments.

Typically, the service includes bundled offerings such as maintenance, monitoring and technical support, with the provider retaining ownership of, and responsibility for, the equipment.

Many EaaS solutions incorporate smart technology and Internet of Things (IoT) sensors to track performance, usage and maintenance needs in real time, enabling predictive servicing and improved efficiency. This model is increasingly popular in sectors such as manufacturing, construction and healthcare where organisations benefit from scalability, reduced downtime and cost predictability.

Current landscape

Deal flow has remained robust over the last few years even when interest rates were rising, indicating sustained buyer interest.

In 2024, disclosed deal values in this sector rose to $8bn from $5.8bn the previous year and from $4.2bn in 2022.

Moreover, the current market is highly fragmented, with acquirers targeting specialised rental firms focused on niche segments. To add perspective, the top 50 operators represent only 50% of the market and the top 10 represent 25% of the market in Europe.

Factors driving growth

Regulations and safety standards

The UK’s stringent safety and emissions regulations encourage the use of modern, up-to-date equipment. From low-emission construction machinery to safer lifting gear, regulatory compliance necessitates continual equipment upgrades. EaaS offers an avenue to access compliant equipment without upfront investments.

Sustainability

There is growing recognition in the UK that equipment rental supports sustainability goals. Renting enables higher utilisation of each asset, reducing the total number of machines that need to be manufactured and eventually disposed of. Moreover, many EaaS firms in the UK are introducing greener technologies such as electric plant equipment and solar lighting towers in their fleets.

Technology

The rise of telematics and IoT in equipment management has enhanced the capabilities of EaaS. UK rental companies leverage these telematics for usage-based pricing, predictive maintenance and asset tracking, thereby improving accuracy, reliability and transparency. The technology integration lowers downtime and optimises fleet efficiency.

Infrastructure

Large infrastructure projects often opt to rent equipment to avoid logistics of ownership and to ensure access to a broad range of machinery. In the UK, due to government initiatives in infrastructure and a focus on improving productivity in construction, EaaS solutions are in demand to support these projects.

Key drivers and motivations for acquirers

Portfolio diversification: Trade buyers pursue acquisitions to broaden their equipment and service offerings. By adding complementary products, they can serve a wider customer base, whilst also gaining access to new technology and capabilities to strengthen their existing offering.

Geographic expansion: Many consolidators are motivated to enter new regions or strengthen their presence in key markets. Acquiring a regional player is often the fastest way to gain market share in a target location. For example, UK-based Vp plc’s purchase of Charleville Plant Hire gave a pathway into the Irish market.

Factors driving buyer appetite and deal values

In the UK EaaS sector, we have seen deal values that have been calculated on adjusted EBITDA/earnings multiples ranging from 5-6x to double-digit figures, depending on various factors such as recurring and contracted revenue, vertical specialisation, strategic positioning and scalability.

Key factors that can influence the value have included:

Recurring and predictable revenue: The strongest driver of higher multiples in the EaaS sector is the presence of recurring revenue streams such as subscription fees, long-term rental contracts and service agreements. Therefore, revenues under contract, usage-based billing tied to essential services, or auto-renewal subscription models will typically command higher EBITDA multiples than solely one-off rental businesses.

Technology integration: EaaS firms which have heavily invested into advancing their technological capabilities (e.g. offering data analytics or proprietary software platforms) command a higher multiple. Tech-enabled companies have better scalability and a stronger competitive advantage, with higher barriers to entry.

Energy transition and net-zero commitments: Due to the UK’s target of being net-zero by 2050, combined with energy efficiency mandates and carbon pricing, businesses and public entities are turning to EaaS providers. This demand increases growth potential, justifying higher valuations.

Market position and growth trajectory: Fast-growing EaaS firms are using their market position to command higher multiples due to the demand in the sector. Leadership in specific sub-sectors (e.g. the NHS or schools) can also drive up premiums.

Strategic buyer synergies: Strategic acquirers, including utilities, infrastructure and energy tech firms, may value EaaS platforms higher due to customer base access, cross-sell opportunities, geographic expansion and platform capabilties.

Regulatory certainty and incentives: Clarity in UK government policies boosts investor confidence, and incentive schemes for decentralised energy or behind-the-meter (BTM) solutions raise perceived value.

M&A interest from acquirers and investment routes

Private equity firms have significantly increased their focus on EaaS. Roughly 25% of European equipment rental transactions since 2018 involved a financial sponsor (private equity or infrastructure fund).

Buy-and-build strategies

Many PE firms view the EaaS industry as an opportunity for buy-and-build consolidation. The sector’s fragmentation allows a sponsor to acquire a platform company and then roll up smaller add-ons to drive growth and multiple expansion.

Specialist/niche providers

Strategic buyers are actively seeking out niche rental and service specialists to complement their core operations. For example, large generalist rental companies have been acquiring firms in high-growth verticals such as event and entertainment equipment rental and power/temperature control rental – niche acquisitions which provide strategic expertise and market share in segments adjacent to their main business.

Technology driven

Another type of business strategic buyers are pursuing is tech-enabled and innovative businesses – targets which have embraced digital platforms or usage-based billing and IoT analytics. Such acquisitions help modernise an acquirer’s operations. Additionally, firms with strong ESG credentials, e.g. electric rental fleets or circular refurbishing programmes, are attractive.

Which EaaS companies have been sold by KBS Corporate?

Tusk Lifting acquired by First Integrated Solutions

We oversaw the seven-figure sale of Tusk Lifting, which specialises in the hire, sale, servicing, inspection and testing of lifting equipment, to Aberdeen-based equipment rental specialist First Integrated Solutions.

Humberside Lifting acquired by Bowers & Bowers

A Scunthorpe-based specialist in the supply, maintenance and repair of industrial lifting and height safety equipment, Humberside Lifting was sold to experienced sector operators Bowers & Bowers in a deal advised on by KBS Corporate.

York Lift Trucks acquired by IVS Materials Handling

A provider of short and long-term forklift truck rentals with flexi-hire contract options, York Lift Trucks was acquired by IVS, which specialises in the sale, hire and servicing of materials handling products and floor care equipment.

If you are the owner of an EaaS company and are considering your exit plans, contact us for an initial conversation with complete confidence and discretion assured.