The company states that FY to March 2020 is expected to...
CUI Global (NASDAQ:CUI) has announced a proposed deal to combine with four other businesses, currently privately held, that provide industrial services to the energy industry and other sectors. The combined business, referred to in the release as Pro-Forma CUI, will be an entirely transformed entity, with more than 3x the revenues (estimated) of the existing CUI. Current CUI shareholders will own about 15% of the enlarged group, while shareholders of the four target businesses will own 85%.
The four target businesses provide services to industries including oil & gas, utilities, and wireless communications. The combined group will become a strong player in midstream/downstream energy infrastructure, and a platform for acquisitive growth going forward.
The chief executive officer (CEO) of the combined group will be Jim O'Neil, formerly of Quanta Services. Quanta is an infrastructure services company that enjoyed very strong acquisitive growth during O'Neil's tenure in top management roles.
The CUI news release includes an outline of the proposed deal structure:
We believe that the terms of the deal imply that the acquired companies are valuing CUI at a premium to its last closing share price of US$1.20.
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