HOUSTON, Nov. 17, 2021
/PRNewswire/ -- Orbital Energy Group, Inc. (NASDAQ: OEG)
("OEG") today announced it has acquired 100% of Front Line Power
Construction LLC ("Front Line," "FLP," or "Company"), a
Houston-based full-service
electrical infrastructure service company that has provided
construction, maintenance, and emergency response services for
customers since 2010.
The transaction will be immediately accretive to earnings and
cash flow and add significant scale to OEG. Combined company
revenue for 2022 is expected to exceed $300.0 million.
Approximately 90% of FLP's revenues are under multi-year
agreements with electric utility and telecommunication customers
providing an attractive recurring revenue base and exposure to
large secular growth markets.
FLP specializes in installing and maintaining electrical
distribution systems and substation infrastructure throughout
Texas. The Company serves investor
owned utilities, electric cooperatives, telecommunications, and
industry customers and has more than 200 employees.
Front Line will become a wholly-owned subsidiary of OEG. The
senior management team, including CEO & Founder, Kurt Johnson, will remain with the company. OEG
expects no organizational changes to FLP's successful, long-term
operations.
"Front Line Power is the ideal acquisition to serve as our
electric power infrastructure platform and to profitably build
revenues both organically and through synergistic acquisitions
going forward. Further, it enhances OEG's transformation into a
full-service energy infrastructure services platform," stated
Jim O'Neil, OEG's Chief Executive
Officer and Vice-Chairman. "FLP's remarkable growth is a testament
to its ability to proactively provide customers with a
comprehensive range of solutions in a market that has significant
momentum driven by aging infrastructure, a transition to renewable
generation, and in a state, Texas,
that has experienced significant population growth."
The Membership Unit Purchase Agreement calls for purchase of the
outstanding membership interest in FLP for a gross purchase price
of $218.4 million. The purchase is
being funded by a $105.0 million
5-year Term Loan, 2-year restricted shares of OEG common stock, and
an approximate $85.0 million
Promissory Note held by the Sellers.
The term loan is being provided by a consortium of Irradiant
Partners, Angelo Gordon, and
Barings. Orbital Energy Group was advised by Piper Sandler & Co. FLP was advised and
represented in this transaction by Romanchuk & Co.
"Of the many acquisitions in which I have been directly involved
in this industry during my career, this transaction with Front Line
Power ranks as one of the best. Kurt's leadership style and core
values, strategic mindset, and care for his employees and customers
coupled with the outstanding job he has done building Front Line
Power is highly valued by myself and my board of directors," O'Neil
continued. "I look forward to working with Kurt to advance OEG,
through its new electric power infrastructure platform, Front Line,
to expand our service offerings, geographic footprint, and customer
base, and to create shareholder value for years to come."
"Front Line has reached a level where it is important for me to
partner with OEG and a proven industry leader like Jim O'Neil to provide long term opportunities
for my employees as well as enable us to meet the increasing
demands of our customers," explained FLP's Founder & CEO,
Kurt Johnson. "As OEG's electrical
power platform, I look forward to teaming with Jim, who shares my
values and vision, to take our company to the next level."
Mr. O'Neil will provide additional comments about the
acquisition during his presentation at the Three Part Advisors
IDEAS Conference on Thursday, November
18 at 2:30 PM EST. A link to
the webcast, along with an Announcement Presentation prepared by
the company, will be available through the "Events and
Presentations" section of the company's investor relations website
or through the IDEAS Conference website.
About Orbital
Orbital Energy Group, Inc. (Nasdaq: OEG)
is creating a diversified energy services platform through the
acquisition and development of innovative companies. Orbital
Energy's group of businesses includes Orbital Power Services,
Orbital Solar Services, Orbital Telecom Services and Orbital Gas
Systems.
Orbital Power Services provides engineering, construction,
maintenance and emergency response solutions to the power,
utilities, and midstream markets.
Orbital Solar Services provides engineering, procurement, and
construction ("EPC") expertise in the renewable energy industry and
established relationships with solar developers and panel
manufacturers in the utility scale solar market.
Orbital Telecom Services, operating as Gibson Technical
Services, has nationwide locations equipped to effectively support
multi-vendor OEM technology environments and outside plant
construction operations on an as-needed basis with specialized
services in broadband, wireless, outside plant and building
technologies, including healthcare. Orbital Gas Systems is a
30-year leader in innovative gas solutions, serving the energy,
power and processing markets through the design, installation and
commissioning of industrial gas sampling, measurement, and delivery
systems.
As a publicly traded company, Orbital Energy is dedicated to
maximizing shareholder value. But most important, our 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:
www.orbitalenergygroup.com
Forward Looking Statements
This press release
contains certain forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934 and Private Securities Litigation
Reform Act, as amended, including those relating to the expected
use of proceeds. These statements may be identified by the use of
forward-looking expressions, including, but not limited to,
"expect," "anticipate," "intend," "plan," "believe," "estimate,"
"potential," "predict," "project," "should," "would" and similar
expressions and the negatives of those terms. These statements
relate to future events and involve known and unknown risks,
uncertainties and other factors which may cause actual results,
performance, or achievements to be materially different from any
results, performance or achievements expressed or implied by the
forward-looking statements. Such factors include the risk
factors set forth in the Company's filings with the SEC, including,
without limitation, its Annual Report on Form 10-K for the year
ended December 31, 2020, its periodic
reports on Form 10-Q, and its Current Reports on Form 8-K filed in
2020 and 2021, as well as the risks identified in the shelf
registration statement and the prospectus supplement relating to
the offering. Prospective investors are cautioned not to place
undue reliance on such forward-looking statements, which speak only
as of the date of this press release. Orbital undertakes no
obligation to publicly update any forward-looking statement,
whether as a result of new information, future events or
otherwise.
Investor Relations:
Three Part Advisors
John Beisler or Steven Hooser
817-310-8776
investors@orbitalenergygroup.com
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SOURCE Orbital Energy Group, Inc.
