- Fulcrum and Autopro are expected to bring C$35 million in revenue and C$5.5 million in EBITDA to mCloud on trailing
twelve month basis
- Makes mCloud a leading provider of disruptive AI, 3D, and cloud
computing solutions to the oil and gas sector
- Transaction expected to close in July
2019
VANCOUVER, April 24, 2019 /CNW/ - Universal mCloud
Corp. (TSX-V: MCLD) (OTCQB: MCLDF) ("mCloud" or the "Company"),
a leading provider of asset management solutions combining IoT,
cloud computing, artificial intelligence ("AI"), and analytics,
announces the signing today of a letter of intent to acquire
Fulcrum Automation Technologies ("Fulcrum"). In parallel, Fulcrum
has today entered into a letter of intent to acquire Autopro
Automation Consultants Ltd. ("Autopro"), resulting in a
three-party transaction that will make mCloud a major technology
provider in oil and gas (the "Transaction"). The Transaction is
considered an at arm's length fundamental acquisition.
mCloud will leverage its AssetCare™ platform for AI, 3D, and
cloud computing with the proven industrial automation expertise and
customer footprint of Fulcrum and Autopro to integrate AI-based
technologies across the oil and gas industry. This announcement
follows on from the Company's prior announcement of the signing of
a C$15 million licensing agreement
with Fulcrum.
As a result of the Transaction, mCloud expects to add
approximately C$35 million in revenue
and C$5.5 million in EBITDA.
"Combining mCloud with Fulcrum and Autopro will let us help oil
and gas providers all over the world use AI and analytics to tap
into large volumes of data in the cloud at a fraction of current IT
costs," said Russel McMeekin, mCloud
President and CEO. "While our relationship with Fulcrum began with
a licensing agreement signed last February, as we began to work
together, we decided that a full combination created the most value
for both shareholders and customers."
"We see considerable synergies aligning Fulcrum and Autopro with
mCloud, as the combined entity now has the advanced technology and
deep industry expertise to potentially drive considerable revenue
growth in the oil and gas sector globally," added Shane Maine, Chairman of Fulcrum. "The mCloud
transaction will bring disruptive capabilities to Autopro's core
business of better optimizing customer assets."
"mCloud's AssetCare provides exceptional strategic alignment
with Autopro's expertise in industrial process control," stated
Mike Lane, Autopro CEO. "The
combination of our in-depth knowledge of process industry
facilities with mCloud's cutting edge AI and analytics will enable
us to deliver even greater value to customers while helping them
manage and optimize the performance of their facilities."
The Transaction will be structured such that Fulcrum will
initially acquire 100% of the issued and outstanding shares of
Autopro for cash and common shares of Fulcrum (the "Autopro
Acquisition"). Immediately thereafter, mCloud will acquire 100% of
the issued and outstanding shares of Fulcrum. Fulcrum is currently
debt-free.
Upon completion of the Transaction, mCloud will own 100% of
Fulcrum and indirectly Autopro. The total consideration value,
subject to adjustments, will be satisfied through C$18 million of cash, to be funded by
C$18 million debt to be raised prior
to closing, and the issuance of 60 million mCloud common shares.
The shares will be distributed to the shareholders of Fulcrum and
Autopro with exact allocation yet to be determined. Based on a
closing share price of C$0.41 on
April 23, 2019 the total transaction
value is C$42.6 million.
The Transaction, which remains subject to satisfactory
completion of due diligence, the entering into of a definitive
agreement satisfactory to the three parties, and a management
information circular prepared in connection with a meeting at which
approval of shareholders will be sought, is expected to close in
July 2019.
Additionally, completion of the Transaction is subject to the
satisfaction of customary closing conditions and required third
party approvals, including the approval of the TSX Venture Exchange
and mCloud shareholders. Additional information concerning the
Transaction will be provided in a subsequent news release upon
execution of definitive agreements by the parties.
Advisors
Raymond James Ltd. is acting as exclusive financial advisor and
Owens Wright LLP is acting as legal counsel to mCloud in connection
with the Transaction. Focus Merchant Group is acting as strategic
advisor to Fulcrum.
mCloud Conference Call
mCloud will host a conference call at 5:00pm ET today to provide a corporate update.
The call will include Russel
McMeekin, Chief Executive Officer and Barry Po, Chief Product Officer.
A live audio webcast of the conference call will be available at
the link below. Please connect at least 15 minutes prior to the
conference call to ensure adequate time for any software download
that may be required to join the webcast. The webcast will be
archived at the below website for one year.
https://event.on24.com/wcc/r/1960645/7D49F04598605596D10F0E1B1026AD98.
Following the Company's press announcement on March 28 providing an update on target
acquisitions, mCloud will provide an update on the fourth quarter
and fiscal year ending December 31,
2018. As a standalone entity, mCloud recorded revenues of
over C$800,000 for the fourth quarter
of 2018, an increase of over 300% compared to the same time period
in fiscal year 2017. The Company also saw a 380% increase in
connected assets totaling 28,800 in 2018 compared to 6,000 in
2017.
The Company expects to file its fully audited results for fiscal
2018 on or before April 29, 2019,
including management discussion and analysis ("MD&A") and
reconciled results including entities announced in 2018 with
binding agreements to be acquired by mCloud.
About Universal mCloud Corp.
Universal mCloud is creating a more efficient future with the
use of AI and analytics, curbing energy waste, maximizing energy
production, and getting the most out of critical energy
infrastructure. Headquartered in Vancouver, Canada, with technology and
operations centers in San Francisco,
CA and Bristol, PA, mCloud
takes advantage of IoT sensors to bring data from connected assets
into the cloud, applying AI and analytics to maximize their health
and performance. Today, mCloud offers complete asset management
solutions to four distinct segments: smart buildings, wind energy,
utilities, and oil and gas. With over 100 blue chip customers and
more than 28,000 assets connected in thousands of locations
worldwide, mCloud is changing the way energy assets are managed.
For more information, visit www.mcloudcorp.com.
About Fulcrum Automation Technologies Ltd.
Fulcrum Automation Technologies is creating the world's premier
control systems integrator, offering integration project services,
subscription-based data analysis and SaaS platforms to clients in
the oil & gas and petrochemicals industries. Through the use of
Artificial Intelligence, Industrial IoT and cloud computing,
Fulcrum Automation Technologies will provide predictive analysis,
real-time data and top-decile reporting to optimize asset
performance.
About Autopro Automation Consultants Ltd.
Autopro Automation Consultants Ltd. is a professional
engineering and integration firm that specializes in the design and
implementation of high-value industrial automation solutions. As
one of the largest vendor-independent integration companies in
North America, they provide a
single source of expertise in all technologies that encompass
industrial automation. Autopro was established in 1990 and has
eight locations across Western
Canada. For more information, visit Autopro's website at
autopro.ca.
Forward-Looking Information and Statements
This press release contains certain "forward-looking
information" within the meaning of applicable Canadian securities
legislation and may also contain statements that may constitute
"forward-looking statements" within the meaning of the safe harbor
provisions of the U.S. Private Securities Litigation Reform Act of
1995. Such forward-looking information and forward-looking
statements are not representative of historical facts or
information or current condition, but instead represent only the
Company's beliefs regarding future events, plans or objectives,
many of which, by their nature, are inherently uncertain and
outside of the Company's control. Generally, such forward-looking
information or forward-looking statements can be identified by the
use of forward-looking terminology such as "plans", "expects" or
"does not expect", "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "anticipates" or "does not
anticipate", or "believes", or variations of such words and phrases
or may contain statements that certain actions, events or results
"may", "could", "would", "might" or "will be taken", "will
continue", "will occur" or "will be achieved". The forward-looking
information contained herein may include, but is not limited to,
the completion of the Transaction, the future business prospects of
the Company and the potential revenue of the Company.
By identifying such information and statements in this manner,
the Company is alerting the reader that such information and
statements are subject to known and unknown risks, uncertainties
and other factors that may cause the actual results, level of
activity, performance or achievements of the Company to be
materially different from those expressed or implied by such
information and statements.
An investment in securities of the Company is speculative and
subject to several risks as discussed under the heading "Risk
Factors" on pages 29 to 46 of the Company's filing statement dated
October 5, 2017. Although the Company
has attempted to identify important factors that could cause actual
results to differ materially from those contained in the
forward-looking information and forward-looking statements, there
may be other factors that cause results not to be as anticipated,
estimated or intended.
In connection with the forward-looking information and
forward-looking statements contained in this press release, the
Company has made certain assumptions. Although the Company believes
that the assumptions and factors used in preparing, and the
expectations contained in, the forward-looking information and
statements are reasonable, undue reliance should not be placed on
such information and statements, and no assurance or guarantee can
be given that such forward-looking information and statements will
prove to be accurate, as actual results and future events could
differ materially from those anticipated in such information and
statements. The forward-looking information and forward-looking
statements contained in this press release are made as of the date
of this press release, and the Company does not undertake to update
any forward-looking information and/or forward-looking statements
that are contained or referenced herein, except in accordance with
applicable securities laws. All subsequent written and oral
forward- looking information and statements attributable to the
Company or persons acting on its behalf is expressly qualified in
its entirety by this notice.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE Universal-mCloud Corp