DPW Holdings Inc (NYSEAMERICAN: DPW) is having an overwhelmingly strong start to the trading session this morning after announcing the completion of an acquisition. Of course, the news of the completed acquisition led to excitement among investors, sending the stock on a run for the top. Today, we’ll talk about:
- The acquisition;
- what we’re seeing from the stock;
- and what we’ll be watching for with regard to DPW ahead.
DPW Announces Acquisition News
As mentioned above, DPW Holdings is having an incredibly strong day in the market today after announcing that an acquisition has been completed. In a press release issued early this morning, the company announced that its subsidiary, Coolisys Technologies, Inc., has completed the acquisition of Enertec Systems 2001 Ltd. Enertec is Israel’s largest private developer and manufacturer of specialized electronic systems for the aerospace and defense markets. With over $8 million in annual revenue generated in 2017, the company is a great value addition to DPW.
The acquisition was completed at a cost of $4,772,520, which was paid in cash to the seller. Coolisys also assumed revolving debt in the amount of $4,288,439 in conjunction with the acquisition.
In a statement, Amos Kohn, President and CEO of the DPW subsidiary, Coolisys, had the following to offer:
The purchase of Enertec marks a major step in continuing to execute our acquisition growth strategy in 2018. We are very pleased that, through this strategic acquisition, we will realize an increase in our sales revenues, an expansion of our customer base, and Coolisys will benefit from Enertec’s innovative technology. Additionally, Coolisys will increase its technological and manufacturing capabilities, thereby positioning itself as an advanced aerospace and defense technology supplier for major strategic defense programs. Further, Enertec may provide synergistic opportunities that Coolisys may leverage through its worldwide divisions and affiliated entities. We strongly believe that the acquisition of Enertec will also invigorate Coolisys’ endeavors in the growing medical and commercial electronics sectors in both international and domestic markets. Coolisys, with Enertec’s assistance, will target the U.S. Department of Defense’s Foreign Military Sales (FMS) and Military Financing (FMF) programs as well as expand its sales by offering its new product and services portfolios to other global defense markets such as India, members of NATO, other countries and agencies.
Coolisys paid to the seller $4,772,520 in cash and assumed $4,288,439 revolving debt of Enertec to certain banks. Concurrently with the closing of the transaction, Coolisys made certain cash payments to reduce the revolving credit lines to Enertec from certain banks and to support Enertec’s longer-term manufacturing contracts.
What We’re Seeing From The Stock
As investors, we know that the news moves the market. The news with regard to DPW Holdings proved to be overwhelmingly positive. With the acquisition, there’s a strong value addition for shareholders. That’s why the stock was flying early on in the pre-market. While the stock has given up some gains since, it is still trading in the green. Of course, our partners at Trade Ideas were the first to alert us to the gains. At the moment (9:47), DPW is trading at $0.74 per share after a gain of $0.0083 per share or 1.13% thus far today.
Stop wasting your time! Start finding winning trades in minutes with Trade Ideas!
What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on DPW. In particular, we’re interested in watching to see the improvements the company sees with the addition of Enertec through the acquisition that was completed and announced today. We’re also interested in following the company’s continued work in not only the cryptocurrency space, but also in the aerospace and defense sector. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
Never Miss The News Again
Do you want real-time, actionable news delivered to your inbox? Join the CNA Finance mailing list below!