anyone know anything?
La Jolla, CA, August 25, 1998 (The Insider Wire) -- According to several
sources
close to the merging talk, SOS Staffing Services, Inc. (NASDAQ: SOSS) is
completing a merging negotiation with Firamada, Inc. (OTC BB: FAMH). The
definite agreement with the pending merger is expected to be released this
week.
SOSS and FAMH agreed to merge in a $56 million stock swap, creating one of the
largest staffing companies in the US with total projected revenue of $400
million in 1998 and total projected revenue of more than $1.2 billion in 2000.
Firamada, Inc. is a National Professional Employer Organization, providing a
comprehensive personnel management system that encompasses a broad range of
services including: benefits and payroll administration, medical and worker's
compensation insurance programs, personnel records management, liability
management, employee recruiting and selection, performance management and
training and development services to small and medium sized business. The
company has seven offices in major markets and serves over 25 small business
clients with approximately 2,500 work site employees throughout the United
States. The company posted revenue of $8.5 million in 1997 with net income of
approximately $2.0 million and currently generates annualized revenue of
approximately $96 million.
SOS Staffing Services, Inc. is a full-service provider of staffing services,
operating through a network of more than 140 offices located in 17 states.
The
company, an independent regional provider of staffing and consulting services,
provides light industrial, clerical, technical, specialty and other
professional
services. The company posted revenue of $238.6 million in 1997 with net
income
of $8.61 million and currently generates annualized revenue of approximately
$304 million in 1998.
Both SOS Staffing Services and Firamada have undergone substantial
improvements
in the past year which are positively affecting current financial results.
SOS
Staffing Services believes that this acquisition is a solid and strategic fit
for SOS staffing. In addition to strengthening its position in the staffing
industry, the merger creates a platform for additional growth, organizational
efficiencies, and improvement of profit margin, as the combined company will
benefit from a centralized general and administrative overhead structure,
other
operating synergies, and vertical integration.
The agreement, which was approved by the boards of both companies, comes as
staffing companies around the nation consolidate to take advantage of rapidly
growing markets and share the costs of adapting new technology and
administrative overhead. According to executives close to the negotiation,
terms of the merger include stock swap and an on-going employment agreement to
retain the services of current FAMH management team. As part of the
transaction, SOS Staffing Services will pay 0.050 shares for each FAMH share.
That would value FAMH shares at $0.7875 each according to SOSS share closing
price of $15 3/4 on Monday. |
