Information technology acquisition and development company FTS Group, Inc. announced today that they signed a letter of intent to acquire a Major IT Solutions provider with $25 million in annual sales. Right now, FTS is generating $7 million in yearly revenue so the acquisition could boost sales 4 times what they are now.
This is huge for the company; they are acquiring a leading IT Solutions provider that is currently operating with a positive cash flow. The deal is likely to close next week. Investors are anticipating that the company will host a call to discuss the deal and 2008 financial projections. The call is to be announced shortly after the closing of the deal.
Chairman and CEO Scot Gallagher was excited about the announcement and he had the following to say, “We’ve been working on this deal for over two months and now expect it to close in the next week or so. The deal turns FTS into a Company with over $30 Million in annual sales overnight. Shortly after closing the acquisition, we will be providing our stockholders with financial guidance for 2008 in both top line sales and cash flow for the consolidated Company. The deal will be immediately accretive to earnings and the most exciting piece to me, is that the deal is virtually non-dilutive to the current stockholders. We’ll be assuming non convertible debt and are finalizing a $3.5 to $5 Million revolving note with our lead fund required to close the transaction.”
The addition of the IT Solutions Company is in line with the company’s strategy to acquire positive cash flow IT companies, then grow and develop their business. They currently own three subsidiaries, the IT solutions company is to be the fourth.
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