ABCO Energy, Inc, (OTCPK, “ABCE”) December 12, 2019 Tucson, Arizona. On December 10, 2019 ABCO completed negotiations and a “Letter of Intent” (LOI) to acquire was signed for the acquisition of a Tucson HVAC company whose sales will be in excess of $1,000,000 for 2019. This acquisition company has been in business for 40 years; sells and services both residential and commercial customers; and has several contracts with the City of Tucson that help to even their workflow during the year. The acquisition is expected to close by January 31,2020.
The acquisition company also has a general contractors license that will pass through to ABCO and allow us to perform more segments of our commercial work without farming such jobs out to others. The company has consistently shown 48% gross profit margins and is projected to bring more than $300,000 profits to ABCO at the EBIDA level. The purchase price negotiated is $300,000 and ABCO is financing $200,000 cash and an owner’s financing of $100,000 over 5 years. This pricing represents a one year payback on investment and eight months payback on cash invested. The acquisition company’s construction equipment is sorely need by ABCO for our Solar jobs and with the expected steady and even monthly cash flows from this acquisition, we hope to reduce our need for seasonal borrowing.
“We are excited about the potential of this acquisition because it gives us the knowledge and experience to sell additional products and services including our solar powered air conditioning systems” said Mike Mildebrandt, President. “Every home and business has air conditioning in Arizona and we intend to knock on many of their doors. We have sold $425,000 in air conditioning service and replacements in the last few months and this acquired team will be able to perform the work for us. We intend to acquire more companies in the next year.