Smoky Market Foods Moving to Build Sales and Grow Revenue Through Acquisitions ; Innovative “Acqui-Ship(TM)” Program Showing Favor with Strategic Food Company Targets

Nov 17, 2009 10:54 ET

WEBSTER CITY, IA, United States, via ETELIGIS INC., 03/23/2015 – – Smoky Market Foods, Inc. (OTC Pink: SMKY) (PINKSHEETS: SMK), announced today that its campaign to acquire strategic food related companies is moving forward extremely well, and will become the transforming factor that takes the Company into fast-track, scalable sales of its artisan Smoke-Baked foods. Said Eddie Feintech, Chairman, President & CEO of SMKY, “We’ll be literally buying our way into national distribution of our product and in the process, near instantly becoming a multi-million dollar food revenue enterprise in 2015.” The Company is tapping its two investment banking relationships that are providing both the qualified target food companies to acquire and the long-term, senior secured debt financing for acquisition capital.

Food processing companies generally initiate their sales and build revenue through “organic” growth, one food distributor or buying customer at a time; the Company has formulated its “ACQUI-SHIPTM” program to grow its sales and revenue channels rapidly through strategic food company acquisitions. “Our learning curve of operations these past few years has vividly shown me that the cost of new product entry into our markets is far too high and certainly far too slow when dealing with traditional distributor channels,” Feintech said. “The smoked food category is saturated with highly processed meat and fish products produced by a countless number of commercial processors, and regional/national distributors simply have not been interested in taking on our artisan quality line without existing customers and/or demanding huge fees. So we’re buying selected distributors and related food sector companies, and gaining firm control of our distribution platform,” he continued.

The Company’s Acqui-Ship concept is unique and proving to be well-received by food business owners who qualify, and to date, management has letters of intent (LOI) signed and in signing process with several companies that total nearly $30 million in revenue and operating income (EBITDA) exceeding $3 million. “We describe Acqui-Ship as a harmonious integration of the key aspects of business acquisition and business partnership,” said Feintech. “We are dealing with successful food business owners (distributors, boutique processors & brokers) who have taken their business to respective levels of profitability and are very receptive to the prospects of taking cash off the table and eliminating their financial responsibilities, while gaining the opportunity to continue executing their long-term plan and fulfilling their entrepreneurial dream for the bigger payoff as a partner with SMKY,” he continued. The Company intends to begin a media campaign to aggressively promote its Acqui-Ship program to expand its network of divisional operating companies, which will continually grow its revenue and food selling channels.

For the successful target food company, the owner receives an initial cash payment to take some capital gain and continues to run the business as a managing partner with the Company, receiving additional purchase payments over the next two years. In the third year, having grown the business’ core revenue and income, along with the additional revenue and income generated by the integration of SMKY food products, the owner will receive an “earn-out” payment, which is based upon a high multiple of the income generated that year. The owner is essentially selling his business to SMKY on the basis of a price ultimately to be determined three years later for the potential of greatly enhanced gain. Said Feintech, “Our investment bank will be sponsoring us for up-listing to a major exchange following the close of our initial bundle of acquisitions, with our trading EPS multiple expected to be 20x and probably higher, and we’ll be acquiring our revenue from these Acqui-Ships at an earnings multiple of 6x affording us great financial leverage. It’s a terrific win-win business relationship for the owner and for us.”

Included in the initial bundle of strategic food companies to be acquired are a food broker, food distributors, food processors, and a fish supplier/processor in Canada. The Company has coordinated the acquisition plan with its New York investment banking group and the present expectation is to complete the debt financing transaction of up to $15 million during July 2015, which provides the funds for the initial acquisition payments and an amount of operating capital. The secured debt transaction will be an interest bearing loan, which is paid off during a period of from five to seven years. “We are in the final stages of wrapping up all LOIs and submitting our loan documents to the New York investment bank, with a binding term sheet for the transaction to be issued soon thereafter,” Feintech said. “The process of keeping SMKY financed during this time is also an on-going endeavor and we were able to recently receive investment support from shareholders to defray the costs of our year-end audit and forthcoming filings; however, at this time we do know our 10K filing will be late and our 10Q will be filed on time.”

About Smoky Market Foods

Smoky Market Foods, Inc. is a producer and distributor of artisan-quality, Smoke-Baked™ foods that are prepared authentically using a unique wood-burning oven system, and sold under the brand names of Smoky Market® and Smoky KosherTM. Because of its proprietary wood-burning oven technology, which burns freshly-cut hickory and apple timber to impart a genuine smoky flavor, the Company’s Smoke-Baked meat and fish are truly prepared the old-fashioned way, without the use of any additives or chemical preservatives. This aspect of quality wholesomeness in prepared food processing is a market niche feature. Smoky Market Foods, Inc. intends to build international retail and foodservice channels of distribution for its smoked foods, and to accelerate its overall corporate revenue growth through making strategic food company acquisitions.

Forward-Looking Statements

Statements in this news release regarding future financial and operating results, future growth in research and development programs, potential applications of our technology, opportunities for the company and any other statements about the future expectations, beliefs, goals, plans, or prospects expressed by management constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements that are not statements of historical fact (including statements containing the words "will," "believes," "plans," "anticipates," "expects," "estimates," and similar expressions) should also be considered to be forward-looking statements. There are a number of important factors that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including: our limited operating history, need for future capital and need to enter into relationships with retailers for retail merchandising business, supply and distribution risks, risks inherent in the development and commercialization of potential products, protection of our intellectual property, and economic conditions generally. Additional information on potential factors that could affect our results and other risks and uncertainties are detailed from time to time in the company’s periodic reports, including the company’s most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q. Forward-looking statements are based on the beliefs, opinions, and expectations of the company’s management at the time they are made, and the company does not assume any obligation to update its forward-looking statements if those beliefs, opinions, expectations, or other circumstances should change.

CONTACT:

SMOKY MARKET FOODS, INC.

Investor Relations

P.O. Box 2864

Aptos, CA 95001

buysmoked

SOURCE: Smoky Market Foods, Inc.

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