SEATTLE, June 13, 2011 (GLOBE NEWSWIRE) -- GeoBio Energy, Inc. (Pink Sheets:GBOE) ("GeoBio"), today announced the signing of a Letter of Intent to acquire all of the ownership interests of a Fort Worth, TX based natural gas service company (the "Service Company").
The Service Company is a contractor servicing oil and natural gas drilling and production that operates primarily in Texas. It has grown rapidly and profitably with an average 40% EBITDA over the last three years. The Service Company provides normal wellhead services as well as proprietary, patent pending specialized services.
GeoBio and the Service Company are currently finalizing the definitive acquisition agreement. GeoBio proposes to acquire the Service Company for a combination of cash, debt and equity in GeoBio, based upon a purchase price equal to 4.5X the verified, 12-month trailing EBITDA at the closing of the purchase, with an anticipated closing within 120-days of the Letter of Intent. The Service Company has already completed a GAAP compliant, certified audit for the period ending December 31, 2010.
Laurence Shelver, the recently appointed CEO of GeoBio Energy, Inc. said, "This proposed acquisition fits nicely with our goal to find and acquire profitable companies with good customer bases, strong and aggressive management teams with a laser focus in the gas and oil services field."
About GeoBio Energy:
GeoBio Energy's business model emphasizes the acquisition and operation of existing companies in the oil and gas services and energy industry. As oil and gas exploration continue in the face of ever rising demand, preparing and monitoring drilling sites and obtaining peak efficiency and production from existing, aging wells becomes increasingly important. GeoBio believes this to be a significant growth opportunity in its strategy to combine and consolidate companies in the oil and natural gas services sector. Visit GeoBio's web site:
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