Vancouver's Mission Ready Solutions (TSX-V:MRS) came out with a battery of news Tuesday morning surrounding a significant acquisition and funding to make it happen.
The company said it has penned a non-binding agreement to acquire Unifire, a Spokane, Washington-based provider of mission critical equipment and services that generated revenue of $18.3 million U.S. during the first six months of 2018 and net income of roughly $750,000 U.S. Customers of Unifire include militaries, law enforcement, fire and rescue squads, utilities and more.
Management sees a prize of the acquisition as not only the immediate revenue, a long client list and established vendors, but also "privileged access to valuable contracts that are set aside for small business, which contracts might not otherwise be available to Mission Ready." As of the latest five-year renewal period, these contracts were valued at over $10 billion U.S.
The acquisition, designed as a reverse-triangular merger that will see Unifire become a subsidiary of Mission Ready, comes at a cost of approximately $9.0 million U.S. to Mission Ready. $4.0 million U.S. will be due in cash, with the other $5.0 million U.S. to be paid in MRS stock, meaning 26.32 million shares at a deemed price $0.19 U.S. per share.
Mission Ready anticipates paying for the cash portion of the transaction from capital raised through a private placement led by Bay Crest Partners and Celadon Financial Group expected to raise $15.0 million U.S.
Additional cash is being added to the merged company's coffers through a new non-binding term sheet with specialty trading and finance company Zenith Insured Credit to provide Unifire a $20-million U.S. credit facility.
Shares of MRS have been halted since July 19, the date the company requested a temporary trading suspension by Investment Industry Regulatory Organization of Canada "pending news." The last time shares changed hands on the Toronto Venture Exchange, the stock was at 21.5 cents
