SOURCE: CMG Holdings, Inc

September 25, 2015 08:45 ET

CMG Holdings Group, Inc. Signs a Letter of Intent to Acquire E&E Enterprises Global, Inc.

CHICAGO, IL--(Marketwired - Sep 25, 2015) - CMG Holdings Group, Inc. (OTCQB: CMGO) announced today it has signed a letter of intent to acquire E&E Enterprises Global, Inc. (, a provider of enhanced telecommunications and IT solutions, including network design, network outsourcing, network management, Tier I call center support, and cyber-security assessment and consulting. The transaction includes assumption of debt obligations of roughly $2.0 million and the issuance of $1.0 million in preferred stock, which will be authorized and issued in the future at a common stock equivalent price of $0.01.

Founded in 1997 and based in Hampton Roads, VA, E&E is an 8(a) certified, service disabled veteran-owned, small disadvantaged business and is one of the fastest growing small businesses within the telecommunications industry as noted by Inc. magazine. E&E has developed partnerships and formed numerous alliances with major IT and broadband solutions providers, which allow the company to provide its customers advanced IT and broadband solutions for almost any type of project almost anywhere on the globe ( E&E is a small business with global reach, offering all forms of broadband to including satellite communications, cable, DSL (ADSL, SDSL and HDSL), T-1 and Fractional T-1 services. The company also builds hybrid wireless networks (celestial or terrestrial), offers Wi-Fi hotspots, and deploys digital satellite television (broadcast news services, global programming; foreign language programming) and space segment (Ka, Ku, C, L, and X band) services across the globe.

E&E has over 80 years of experience working with and within the federal government and meeting their requirements by providing face-to-face interaction for each project. The Company customer tailors each solution for each customer. E&E is a General Services Administration (GSA) Schedule contractor with a Multiple Awards Schedule (MAS) Contract (GS-35-F-0779N, IT Professional) and is a SATCOM II Schedule Contract holder. Under its MAS Contract, E&E can offer the same products and services provided to federal government customers to state and local government agencies. The Company's products are being utilized for Homeland Security and in case studies conducted by California Amber Alert System, Federal Emergency Management Agency (FEMA), Space Shuttle Columbia Recovery Efforts and The Comprehensive Test Ban Treaty Organization. Solutions are rapidly scalable, from statewide, to continent-wide, to worldwide. For a list of current customers see

E&E is a profitable business that is on track to generate $6-8 million dollars of top line revenue in 2015E with 8%-10% EBITDA margins. The Company's peak performance in the past topped $20 million revenues with 15%-20% EBITDA margins, driven by significant pent-up demand for network services and support primarily from the U.S. federal government across numerous agencies and departments. We believe with a rightsized balance sheet and access to improved working capital, E&E should be able to return to record revenue and EBITDA run rates within a period of 18-24 months. Strategic mergers and acquisitions leveraging E&E's existing corporate infrastructure and operating capabilities could add considerably to these levels and provide further upside to the plan. Altogether, our goal is to build a $100 million revenue company generating 15%-20% EBITDA margins within a period of three years, through organic growth and M&A. E&E is a platform investment for our Company, and we expect it to be highly accretive to earnings and drive considerable value for our stakeholders over the coming years.

Said Glenn Laken, "Our planned acquisition of E&E is a turning point for our Company. We are currently in various stages of discussions, negotiations and due diligence on several companies in the communications services, communications infrastructure, value-added services, and cyber-security markets that together represent a foundation off which we intend to build a substantially larger company focused on cyber infrastructure. We are currently circling capital from institutional investors and intend to close a number of transactions over the next several months, with a goal of putting CMG onto firmer footing as a self-sufficient company we intend to rename "Cyber Management Group". We intend to be a new player in the high growth markets for secure communications, connectivity and networking with anchor tenants in the difficult to crack federal government market and expansion into the global enterprise marketplace.

Safe Harbor Statement:

CMG Holdings Group cautions that statements made in press releases constitute forward-looking statements, and make no guarantees of future performances and actual results/developments may differ materially from projections in forward-looking statements. Forward-looking statements are based on estimates and opinions of management at the time statements are made.

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