Business
SMG Industries Acquires a Leading Midstream Logistics and Rig Move Company Projected to Increase Annual Revenues Approximately 590% to an estimated $60 million for fiscal 2020
SMG Industries Acquires a Leading Midstream Logistics and Rig Move Company Projected to Increase Annual Revenues Approximately 590% to an estimated $60 million for fiscal 2020.
About this update from Smg Industries, Inc.
[{"type":"text","content":"SMG Continues its Buy and Build Strategy diversifying into Midstream with established compressor heavy haul and drilling rig move services companyHOUSTON, TX / ACCESSWIRE / March 3, 2020 / SMG Industries, Inc. (the "Company") (OTCQB:SMGI), a growth-oriented midstream and oilfield services company operating in the Southwest United States announced today the acquisition of 100% of the membership interests of 5J Oilfield Services LLC and 5J Trucking LLC (together the "5J Companies" or "5J") that closed on February 27, 2020.5J is an industry recognized sixteen year old company that enjoys a strong presence operating throughout the Southwest United States with over 165 customers. 5J is an asset rich company with a fleet of approximately 100 trucks, 240 trailers, 18 cranes and 25 forklifts utilized to move large compressors and production equipment for midstream, pipeline and oilfield companies, as well as drilling rig mobilization for operators and drilling contractors. 5J's assets were recently appraised at $24 million, in connection with the acquisition, based on an orderly liquidation value basis (OLV). 5J currently has five facilities to service its broad base of customers throughout Texas, Louisiana and New Mexico.Highlights of the acquisition include:The Company acquired 100% of the membership interests of both 5J Oilfield Services LLC and 5J Trucking LLC for approximately $27.3 million in consideration of a combination of cash, assumed notes, preferred stock and refinanced debt,Currently, the Company projects 2020 consolidated revenues, inclusive of 5J, of approximately $60 to 64 million and an estimated adjusted EBITDA range of approximately $7 to 8 million,The seasoned and proven 5J management team has been retained with 5J post-acquisition under new employment agreements and SMGI vesting scheduled incentive stock options,The acquisition is immediately accretive to SMGI on a consolidated basis,Strong cross-selling opportunities exist given the additional 165+ combined customer base,The Company's buy and build strategy indicates both cross selling opportunities with its acquisition and has identified other midstream acquisition candidates to further follow customer growth and capex spend in that sector.5J's sales force will immediately be able to promote SMG's products and SMG'...