CMG Holdings Group, Inc. Signs a Letter of Intent to Acquire E&E Enterprises Global, Inc.
September 25 2015 - 08:45AM
Marketwired
CMG Holdings Group, Inc. Signs a Letter of Intent to Acquire
E&E Enterprises Global, Inc.
CHICAGO, IL-(Marketwired - Sep 25, 2015) - CMG Holdings Group,
Inc. (OTCQB: CMGO) announced today it has signed a letter of intent
to acquire E&E Enterprises Global, Inc.
(http://www.eeenterprisesinc.com), a provider of enhanced
telecommunications and IT solutions, including network design,
network outsourcing, network management, Tier I call center
support, and cyber-security assessment and consulting. The
transaction includes assumption of debt obligations of roughly $2.0
million and the issuance of $1.0 million in preferred stock, which
will be authorized and issued in the future at a common stock
equivalent price of $0.01.
Founded in 1997 and based in Hampton Roads, VA, E&E is an
8(a) certified, service disabled veteran-owned, small disadvantaged
business and is one of the fastest growing small businesses within
the telecommunications industry as noted by Inc. magazine. E&E
has developed partnerships and formed numerous alliances with major
IT and broadband solutions providers, which allow the company to
provide its customers advanced IT and broadband solutions for
almost any type of project almost anywhere on the globe
(http://www.eeenterprisesinc.com/partners.html). E&E is a small
business with global reach, offering all forms of broadband to
including satellite communications, cable, DSL (ADSL, SDSL and
HDSL), T-1 and Fractional T-1 services. The company also builds
hybrid wireless networks (celestial or terrestrial), offers Wi-Fi
hotspots, and deploys digital satellite television (broadcast news
services, global programming; foreign language programming) and
space segment (Ka, Ku, C, L, and X band) services across the
globe.
E&E has over 80 years of experience working with and within
the federal government and meeting their requirements by providing
face-to-face interaction for each project. The Company customer
tailors each solution for each customer. E&E is a General
Services Administration (GSA) Schedule contractor with a Multiple
Awards Schedule (MAS) Contract (GS-35-F-0779N, IT Professional) and
is a SATCOM II Schedule Contract holder. Under its MAS Contract,
E&E can offer the same products and services provided to
federal government customers to state and local government
agencies. The Company's products are being utilized for Homeland
Security and in case studies conducted by California Amber Alert
System, Federal Emergency Management Agency (FEMA), Space Shuttle
Columbia Recovery Efforts and The Comprehensive Test Ban Treaty
Organization. Solutions are rapidly scalable, from statewide, to
continent-wide, to worldwide. For a list of current customers see
http://www.eeenterprisesinc.com/company_customers.html.
E&E is a profitable business that is on track to generate
$6-8 million dollars of top line revenue in 2015E with 8%-10%
EBITDA margins. The Company's peak performance in the past topped
$20 million revenues with 15%-20% EBITDA margins, driven by
significant pent-up demand for network services and support
primarily from the U.S. federal government across numerous agencies
and departments. We believe with a rightsized balance sheet and
access to improved working capital, E&E should be able to
return to record revenue and EBITDA run rates within a period of
18-24 months. Strategic mergers and acquisitions leveraging
E&E's existing corporate infrastructure and operating
capabilities could add considerably to these levels and provide
further upside to the plan. Altogether, our goal is to build a $100
million revenue company generating 15%-20% EBITDA margins within a
period of three years, through organic growth and M&A. E&E
is a platform investment for our Company, and we expect it to be
highly accretive to earnings and drive considerable value for our
stakeholders over the coming years.
Said Glenn Laken, "Our planned acquisition of E&E is a
turning point for our Company. We are currently in various stages
of discussions, negotiations and due diligence on several companies
in the communications services, communications infrastructure,
value-added services, and cyber-security markets that together
represent a foundation off which we intend to build a substantially
larger company focused on cyber infrastructure. We are currently
circling capital from institutional investors and intend to close a
number of transactions over the next several months, with a goal of
putting CMG onto firmer footing as a self-sufficient company we
intend to rename "Cyber Management Group". We intend to be a new
player in the high growth markets for secure communications,
connectivity and networking with anchor tenants in the difficult to
crack federal government market and expansion into the global
enterprise marketplace.
Safe Harbor Statement:
CMG Holdings Group cautions that statements made in press
releases constitute forward-looking statements, and make no
guarantees of future performances and actual results/developments
may differ materially from projections in forward-looking
statements. Forward-looking statements are based on estimates and
opinions of management at the time statements are made.
Contact Information
Contact: Investor Relations CMG Holdings Group, Inc.
773-698-6047
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