OAKVILLE, ON / ACCESSWIRE / October 28, 2022 / Spark Power Group Inc. ("Spark Power" or the "Company") (TSX:SPG) is pleased to announce that its wholly owned subsidiary, Spark Power Solutions Inc., has entered into a binding agreement with an arm's length buyer (the "Purchaser"), with respect to the sale by Spark Power of its Bullfrog Power Inc. business unit ("Bullfrog"), including its United States business carried on through Bullfrog Solutions USA Inc., and its subsidiary companies, to the Purchaser for total proceeds of up to $35.0 million, subject to customary adjustments, and includes an earnout of up to $3.5 million, payable over a maximum of five years. Proceeds from the transaction are expected to be used to reduce Spark Power's debt and fund working capital needs. This strategic divestiture supports the Company's renewed focus on its core business and will provide the necessary capital to support the growth strategy of its Technical Services and Renewables segments.
While Spark Power is divesting Bullfrog, the Company believes that the market for Bullfrog's service offering, and sustainability services in general, has never been stronger, with favourable tailwinds in the industry. Spark Power anticipates that, following closing of the transaction, there will be ongoing opportunities for the Company and Bullfrog to work together in a mutually beneficial capacity, leveraging Spark Power's expertise in installing, maintaining, and servicing renewable-generating electrical assets.
Richard Jackson, President & CEO of Spark Power, commented on the transaction, "Bullfrog has been an important part of establishing Spark as a leader in sustainability and the Bullfrog brand is synonymous with thought leadership in this space. While the business has grown significantly under Spark since its acquisition, it represents a small portion of our current revenue portfolio and, as Spark Power embarks on the next phase of its maturity and strategic growth plan, it was determined that the Bullfrog business was not core to our technical services and renewables-based strategy. The Board and Spark Power's leadership therefore felt that this was the appropriate time to explore a sale of the business unit. We would like to extend our gratitude to all of Bullfrog's passionate and hard-working employees and we believe that we are placing them in good hands."
The transaction is anticipated to close on or about November 15, 2022, subject to the Purchaser securing financing for the transaction and other customary closing conditions. In addition, the transaction closing is subject to approval of Spark Power's lender, for which we do not anticipate any delays. While management expects the transaction to close on or about November 15, 2022 in accordance with the terms of the purchase agreement, there can be no assurance that the proposed transaction will occur.
About Spark Power Group Inc.
Spark Power Solutions Inc., a wholly owned subsidiary of Spark Power Group Inc. (TSX:SPG), is a leading independent provider of end-to-end electrical contracting, operations and maintenance services, and energy sustainability solutions to the industrial, commercial, utility, and renewable asset markets in North America. We work to earn the right to be our customers' Trusted Partner in Power™. Our highly skilled and dedicated people, located in the communities we serve, combined with our knowledge of the power industry, technology expertise, and commitment to safety, ensures we deliver the right solutions that keep our customers' operations up and running today and better equipped for tomorrow. Learn more at www.sparkpowercorp.com.
This news release may contain forward-looking statements (within the meaning of applicable securities laws) which reflect Spark Power's current expectations regarding future events. Forward-looking statements are identified by words such as "believe", "anticipate", "project", "expect", "intend", "plan", "will", "may", and other similar expressions. The forward-looking statements in this press release include statements regarding the expected closing date, the expectation of the Company to receive the approval of its lender, the Company's future growth and availability of capital to execute on the Company's growth plan and future opportunities for Spark to work with Bullfrog. The forward-looking statements in this news release are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. Several factors could cause actual results to differ materially from the results discussed in the forward-looking statements. Such factors include, among others: currency fluctuations; disruptions or changes in the credit or security markets; the Purchaser failing to secure financing, results of operations; and general developments, market and industry conditions, and those risks disclosed in the Company's annual information form for the year ended December 31, 2021 available on the Company's profile at www.sedar.com. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, these forward-looking statements are made as of the date of this news release and, except as expressly required by applicable law, Spark Power assumes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
Investor and Regulatory Inquiries:
Richard Perri, Executive Vice President & Chief Financial Officer
+1 (905) 829-3336
April Currey, VP, Sales & Marketing
+1 (365) 228-1023
SOURCE: Spark Power Group Inc.