RE: NEWSINFRAX Systems (IFXY) to Buy Broadband Holdings and Affiliated EntitiesInfrax Continues Drive to Become Global Market Leader in Smart Grid and Wireless Broadband Markets
INFRAX SYSTEMS, Inc. (OTCBB: IFXY), a global provider of unified Smart Grid-related products and services for the Energy and Utility industries, announced today that it has entered into an agreement to acquire Broadband Holdings, Inc., and affiliate companies including Broadband Specialists, Inc., a privately-held, full-service engineering, and design firm.
BSI has recently been awarded contracts by
- The State of Texas
- AT&T
- Time Warner Cable
- As well as significant wind farm and rural fiber to the home (FTTH) initiatives
The BSI technical team's multi-disciplined expertise will augment Infrax's technical capabilities. Management of the combined Companies will include executives and Board members from both organizations.
- Broadband Specialists' 2009 revenues exceeded Eight Million Dollars, with forecasted 2010 broadband and alternative energy design and construction revenues expected to substantially exceed 2009 revenues, on a standalone basis.
- Has an over Thirty Million Dollars backlog of committed infrastructure contracts for 2011 and beyond. Infrax anticipates significant revenue growth as a result of adding BSI's design and installation capabilities to our Secure Intelligent Energy Platform.
BSI has installed fiber to over 300 wireless towers in the past few years in support of 4G roll outs."
How does this acquisition affect Infrax Systems and what it means to our shareholders?
Revenues -- BSI's acquisition will add an estimated, thirty million dollars in revenue to Infrax systems' topline revenue over the next two years, which does not includes the Smart Grid and the Wireless Broadband revenue contributions.
Shareholder Equity -- BSI's acquisition will add, an estimated, six million dollars in shareholder equity to our balance sheet at closing, subject to the final review of our accounting firm.
Human Resources -- BSI's acquisition will add fifty-five employees to our current staff of 12.
Product Offerings -- With BSI, Infrax can truly offer end to end solutions to our utility customers including secure wireless and fiber deployments for metering, demand response, distributed power generation systems and distribution automation applications.
Broader Revenue Opportunities -- This acquisition will allow combined Companies to target revenue opportunities upgrading America's aging infrastructure. The market for BSI's services can be compared to the original build outs of the electrical grid, telephone systems and the networks of interstate highways in the 1950's and 1960's. America's existing electrical, gas and water lines are aging. According to the Energy Information Administration, or "EIA", the electric utility market is one of the largest industries in North America. Globally the industry is expected to spend close to ten trillion dollars by 2030 to upgrade and effectuate Smart Grid technologies. In the U.S., the Federal Government forecasts that the total amount of private and public funds that will be invested in smart grid projects through a stimulus program will be over eight billion dollars.
"The combination of Infrax and BSI should create a force in the Utility Infrastructure and Smart Grid market, as the two companies build on their existing relationships and capabilities. They will be incredibly well positioned to take advantage of the pent up demand for upgrading America's communications, utility and transportation infrastructure, which together are receiving hundreds of billions of stimulus funding from the federal government over the next several years. This transaction is one more step in a series of transactions that should position Infrax as a market leading provider of one-stop shop Smart Grid and Broadband Solutions in the U.S. and abroad."
The acquisition is expected to close within 60 days after the completion of due diligence. Additional financial details of the transaction will be disclosed with the completion of the acquisition or when available.