OVERLAND PARK, KS--(Marketwire - 06/13/11) - Flint Telecom Group, Inc. (http://www.flinttelecomgroup.com) (OTC.BB:FLTT - News), an international telecoms technology and services organization, today announces that it has completed a Letter of Intent to acquire the assets of a telecom company providing services to small and medium enterprises and other groups in the United States. Under the terms of the non-binding letter of intent, Flint Telecom will acquire all of the customers, equipment, contracts and operating licenses on completion of definitive agreements and required regulatory filings.
The assets being acquired are currently generating positive net income of approximately 10% on annual revenues in excess of $3 million. When consolidated with other announced and pending acquisitions, operating costs should be further reduced due to shared common services and network cost reductions that are expected to further improve net income.
Under the terms of the letter of intent, definitive agreements are planned to complete within 45 days following standard due diligence at which point Flint Telecom will have to provide a $100,000 non-refundable deposit to move to closing. The agreed purchase price for the assets is $1 million in cash with a further $250,000 at closing with the remaining balance spread over 14 months from closing.
In 2010, Fierce VoIP magazine quoted an In-Stat report stating that VoIP penetration will double by 2013 to 79 percent from about 33 percent of companies in 2009. Broadband IP Telephony revenue will also double by 2013, In-Stat said, fueled by single user applications as well as the mobile workforce.
Vincent Browne, Chairman and Chief Executive of Flint Telecom Group, said, "This continues our stated acquisition strategy to achieve our target of ten acquisitions this year, creating a highly profitable business unit delivering integrated voice, data and wireless services to small and medium sized enterprises with profitable annual revenues in excess of $20 million. This deal comes on the back of our first Form-S1 filing, in conjunction with our Kodiak Capital equity line, being made effective. With that milestone achieved, we can now show prospective acquisitions and customers that we have access to sufficient capital over the next two years to fund operations and strengthen our balance sheet. It will also free up management resources to concentrate on completing this and previously announced letters of intent that have been delayed due to the current Form-S1 filing process."
About Flint Telecom Group, Inc.
Flint Telecom Group Inc. is an international Telecoms Technology Organization with a portfolio of companies that deliver VoIP and wireless communications and prepaid financial products and services globally. Headquartered in Overland Park, Kansas with offices throughout the US, India and Ireland, Flint Telecom Group is a fully reporting company trading on the OTC Bulletin Board® (OTCBB) under the ticker symbol: FLTT.OB. Flint Telecom ranked number 72 in the 2010 Deloitte Technology Fast 500™, Deloitte's ranking of 500 of the fastest growing technology, media, telecommunications, life sciences and clean technology companies in North America. Flint Telecom was founded by a team of telecom and technology experts with a proven track in building and maintaining international technology companies. Additional information may be found at www.flinttelecomgroup.com
This press release contains forward-looking statements, which are made pursuant to the Safe-Harbor provisions of the Private Securities Litigation Reform Act of 1995. Words such as "expects," "intends," "believes," and similar expressions reflecting something other than historical fact are intended to identify forward-looking statements, but are not the exclusive means of identifying such statements. These forward-looking statements involve a number of risks and uncertainties, including the timely development and market acceptance of products and technologies, the ability to secure additional sources of finance, the ability to reduce operating expenses, and other factors described in the Company's filings with the Securities and Exchange Commission. The actual results that the Company achieves may differ materially from any forward-looking statement due to such risks and uncertainties. The Company undertakes no obligation to revise or update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release.
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