HOUSTON, March 26, 2020 /PRNewswire/ -- CUI Global, Inc.
(Nasdaq: CUI) ("CUI Global" or the "Company") announced today that
on March 24, 2020, it entered into a
definitive agreement to acquire Reach Construction Group, LLC, an
industry-leading solar construction company. The transaction will
consist of third-party debt and company equity valued at
approximately $37.0 million
(excluding working capital and certain other adjustments upon
closing). The acquisition is expected to close within the next 20
days, subject to customary closing conditions.
Headquartered in Apex, NC,
Reach Construction Group ("Reach") is an engineering, procurement
and construction ("EPC") company with expertise in the renewable
energy industry. Reach has contractual backlog for 2020 exceeding
$100 million. The acquisition is
expected to be immediately accretive to CUI Global's consolidated
results.
Strategic Rationale and Benefits
Established as a leading provider of EPC services in the utility
scale solar industry, Reach Construction Group is expected to
deliver several strategic benefits, including:
- Expanding CUI Global's energy services business into the
rapidly growing alternative energy industry, particularly building
on Reach's established relationships that currently exist with
solar developers and panel manufacturers in the utility scale solar
market;
- Diversifying Reach's current capabilities into a broader set of
service offerings in the energy infrastructure market; and,
- Enhancing CUI's revenue while contributing positive net
earnings.
"This transaction is a considerable first step in our strategic
plan to become a diversified energy infrastructure services
company," said William Clough,
executive chairman of CUI Global. "Under the direction of our new
CEO, Jim O'Neil, we expect this
transaction to deliver strong financial results, which will result
in positive earnings for CUI Global's shareholders on a
consolidated basis."
"Reach is a recognized market leader in providing renewable
energy EPC services and the leadership team has over 50 years of
combined industry experience successfully delivering renewable
energy projects to their customers," stated Jim O'Neil, vice chairman and CEO of CUI Global.
"We are very pleased to expand CUI's infrastructure energy services
into the growing renewable energy market, as well as to play a key
role in reducing carbon emissions in the country. This acquisition
also provides a solid platform for us to diversify into synergistic
services that serve the electric power industry. We look forward to
working with Reach to capitalize on their leadership position in
the renewable energy market and increase value to our shareholders.
We will discuss the transaction in more detail during our Earnings
Conference Call on Monday."
Reach's CEO & founder, Brandon
Martin, commented, "We, at Reach, are excited to become a
part of the CUI Global energy team and to help lead the way toward
a net zero carbon emissions future. With solar accounting for 40%
of all new electric generating capacity in 2019, the acquisition of
Reach gives CUI Global a competitive advantage over other
traditional energy companies who have yet to make the transition
toward a clean energy future. I am honored to join this team of
proven industry leaders and visionaries."
About CUI Global, Inc.
CUI Global, Inc. is a publicly
traded company dedicated to maximizing shareholder value through
the acquisition and development of innovative companies to create a
diversified energy infrastructure services platform. Through
its Energy business units operating as Orbital Gas Systems, CUI
Global is a leader in innovative gas solutions with more than 30
years of experience in design, installation and the commissioning
of industrial gas sampling, measurement and delivery systems
providing solutions to the energy, power and processing
markets. Orbital Gas Systems manufactures and delivers a broad
range of technologies including environmental monitoring, gas
metering, process control, telemetry, gas sampling and BioMethane.
As a publicly traded company, shareholders can participate in the
opportunities, revenues, and profits generated by the products,
technologies, and market channels of CUI Global and its
subsidiaries. But most important, a commitment to conduct business
with a high level of integrity, respect, and philanthropic
dedication allows the organization to make a difference in the
lives of their customers, employees, investors and global
community.
For more information please visit: http://www.cuiglobal.com
Important Cautions Regarding Forward Looking
Statements
This document contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
Such statements are subject to risks and uncertainties that could
cause actual results to vary materially from those projected in the
forward-looking statements. The Company may experience significant
fluctuations in future operating results due to a number of
economic, competitive, and other factors, including, among other
things, our reliance on third-party manufacturers and suppliers,
government agency budgetary and political constraints, new or
increased competition, changes in market demand, and the
performance or reliability of our products. These factors and
others could cause operating results to vary significantly from
those in prior periods, and those projected in forward-looking
statements. Additional information with respect to these and other
factors, which could materially affect the Company and its
operations, are included in certain forms the Company has filed
with the Securities and Exchange Commission.
Investor Relations:
KCSA Strategic Communications
David Hanover
T: 212-896-1220
dhanover@kcsa.com
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SOURCE CUI Global, Inc.