CMG Signs Letter of Intent to Acquire Blue Horizon Concepts
October 08 2015 - 01:10PM
InvestorsHub NewsWire
CMG Signs Letter of
Intent to Acquire Blue Horizon Concepts
CHICAGO, IL -- Oct 8, 2015 -- InvestorsHub NewsWire -- CMG Holdings
Group, Inc. (OTC:
CMGO) today announced it has signed a letter of intent to
acquire Blue Horizon Concepts, Inc. (“BHC”), a provider of wireless
communications contracting services, including general contracting,
civil construction, and electrical, aerial tower, technical and
testing services. Consideration for the business includes
$675,000 cash, $575,000 seller notes, and $1.25 million preferred
stock, which will be authorized and issued in the future and
convertible into common stock at $0.0125.
BHC has more than 25 years of experience in general contracting
services such as design build construction management, project
management, hard bid, and renovations/turn-key/upfits. The
Company is based near Richmond, Virginia and has numerous
designations that illustrate its strategic value, including
Virginia Small Women & Minority Owned Business (SWaM), Minority
Owned Business (MBE), Carolinas Virginia Minority Supplier
Development Council (CVMSDC), National Association State
Contractors Licensing Agencies (NASCLA), and National Association
of Tower Erectors (NATE). Technical certifications include
Ericsson, Nokia, Alcatel Lucent: BTS / LTE Integration; Anritsu,
Kaelus PIM Testing, Line Sweep; ODM, Fiber Optic Testing; Ceragon
Microwave Integration; CCI RXAIT / PIM; Comtrain, Advanced Tower
Climbing and Rescue; Crosby, ASME Rigging; Andrew / JMA connector
Training; and OSHA 30 Hour. Based on year-to-date results and
before anticipated synergies, BHC is on pace to generate
approximately $2.5 million revenues and over $600,000 EBITDA, which
suggests a purchase price of roughly 4.1x EBITDA. Peak
revenues and EBITDA were substantially higher based on prior cycle
higher capital expenditure run rates across the wireless
sector.
Said Glenn Laken, “Our planned acquisition of BHC is a hand in
glove fit with our previously announced acquisition of E&E
Enterprises, located roughly one hour away from BHC in
Virginia. We expect to derive numerous hard dollar and soft
dollar synergies from the combination of the businesses, ranging
from reduced overhead costs, increased utilization of BHC’s crews
on substantial contracts with wireless carriers, and improved
margins as a result of bringing work in house rather than relying
extensively on subcontractors. Further, the devastation of
the Carolinas after recent deluges provides an opportunity for BHC
and E&E to play a role in rebuilding and repairing critical
infrastructure in the region. Looking ahead, we anticipate
renewed investment activity by wireless carriers throughout the
country as a result of a heightened focus on tower work and DAS
spending, which should lead to revenue acceleration for our family
of companies.”
With these two businesses, CMG’s Communications Infrastructure
group will be on track to generate pro forma revenues north of $10
million in 2014, with the potential for 50%-100% annual top line
growth for the next few years. E&E is currently
responding to a tower contract in Mississippi that encompasses 1600
units of work and a total of $10.4 million of business, with
similar contracts available in neighboring states. Further,
active cable contracts in the Midwest have the potential to
generate upwards of $100 million of backlog for E&E, as
evidenced by similar sized awards to other incumbents supporting a
leading cable MSO in the region. Further, based on E&E’s
security clearance and history of work for the federal government,
we believe E&E can play a critical role in the deployment of
FirstNet (First Responder Network Authority – www. http://firstnet.gov), the US Government’s emergency
communications network currently being built nationwide with
funding currently targeted at over $7 billion.
Glenn Laken, CEO of CMG Holdings Group, commented on the
opportunities facing the organization: “We continue to be 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 aspire to become a leading player
in the high growth markets for secure communications, connectivity
and networking with anchor tenants in government, telco and
enterprise markets.”
Safe Harbor Statement:
CMGO 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:
Investor Relations
CMG Holdings Group, Inc.
773-698-6047
CMG (PK) (USOTC:CMGO)
Historical Stock Chart
From Feb 2024 to Mar 2024
CMG (PK) (USOTC:CMGO)
Historical Stock Chart
From Mar 2023 to Mar 2024