CMG Signs Letter of Intent to Acquire Blue Horizon Concepts

CHICAGO, IL--(Marketwired - Oct 8, 2015) - CMG Holdings Group, Inc. (OTCQB: CMGO) today announced it has signed a letter of intent to acquire Blue Horizon Concepts, Inc. ("BHC"), a provider of wireless communications contracting services, including general contracting, civil construction, and electrical, aerial tower, technical and testing services. Consideration for the business includes $675,000 cash, $575,000 seller notes, and $1.25 million preferred stock, which will be authorized and issued in the future and convertible into common stock at $0.0125.

BHC has more than 25 years of experience in general contracting services such as design build construction management, project management, hard bid, and renovations/turn-key/upfits. The Company is based near Richmond, Virginia and has numerous designations that illustrate its strategic value, including Virginia Small Women & Minority Owned Business (SWaM), Minority Owned Business (MBE), Carolinas Virginia Minority Supplier Development Council (CVMSDC), National Association State Contractors Licensing Agencies (NASCLA), and National Association of Tower Erectors (NATE). Technical certifications include Ericsson, Nokia, Alcatel Lucent: BTS / LTE Integration; Anritsu, Kaelus PIM Testing, Line Sweep; ODM, Fiber Optic Testing; Ceragon Microwave Integration; CCI RXAIT / PIM; Comtrain, Advanced Tower Climbing and Rescue; Crosby, ASME Rigging; Andrew / JMA connector Training; and OSHA 30 Hour. Based on year-to-date results and before anticipated synergies, BHC is on pace to generate approximately $2.5 million revenues and over $600,000 EBITDA, which suggests a purchase price of roughly 4.1x EBITDA. Peak revenues and EBITDA were substantially higher based on prior cycle higher capital expenditure run rates across the wireless sector.

Said Glenn Laken, "Our planned acquisition of BHC is a hand in glove fit with our previously announced acquisition of E&E Enterprises, located roughly one hour away from BHC in Virginia. We expect to derive numerous hard dollar and soft dollar synergies from the combination of the businesses, ranging from reduced overhead costs, increased utilization of BHC's crews on substantial contracts with wireless carriers, and improved margins as a result of bringing work in house rather than relying extensively on subcontractors. Further, the devastation of the Carolinas after recent deluges provides an opportunity for BHC and E&E to play a role in rebuilding and repairing critical infrastructure in the region. Looking ahead, we anticipate renewed investment activity by wireless carriers throughout the country as a result of a heightened focus on tower work and DAS spending, which should lead to revenue acceleration for our family of companies."