TAMPA, Florida, April 18, 2017 /PRNewswire/ --
MagneGas Corporation ("MagneGas" or the "Company") (NASDAQ: MNGA), a leading clean technology company in the renewable resources and environmental solutions industries, announced today that it has created a wholly-owned subsidiary called MagneGas Welding Supply, LLC. This new entity will hold all current and future assets related to the Company's gas and welding supply retail business including Equipment Sales and Services, Inc. ("E.S.S.I").
In late 2014, the Company acquired E.S.S.I., a welding gas and supply company to use as a platform to sell MagneGas2® fuel. Through this acquisition, the Company has been able to demonstrate that the sale of MagneGas2® is a significant door-opener to other sales with a corresponding growth rate that is much greater than the industry average.
To capitalize on this competitive advantage, MagneGas has developed a strategy to grow sales through organic expansion and accretive acquisitions of other welding gas supply companies. This growth is expected to take place in Florida and Indiana, where the Company already has an organic sales force, as well as select new U.S. markets. MagneGas is actively seeking to penetrate some of the strongest industrial markets in the U.S., particularly those where a clean technology solution such as MagneGas2® would be well-received.
The Company has identified a number of high-quality acquisitions. The key criteria for these targets include a strong existing management team, a stable customer base, consistent profitability, and a scalable addressable market. To that end, the Company has established MagneGas Welding Supply, LLC as a wholly-owned subsidiary to consolidate these operations as it pursues this acquisition strategy.
"Over the past 90 days, the Company has embarked on an aggressive strategy to contain costs through the reduction of non-essential employees and consultants, along with the realignment of certain personnel in sales related positions," stated Scott Mahoney, C.F.O. of MagneGas Corporation. "It has been a top priority to develop a clear path to self-sustained organic growth in 2017. We now have a clear plan for near term execution."
"We believe the parent organization is now ready to fully-focus on a concrete growth plan using a clearly defined acquisition strategy. The executive team has spent an extensive period of time evaluating a number of high quality acquisitions. We believe we have the opportunity to begin systematically consolidating a meaningful position in this space over the coming quarters and for the next several years. The creation of MagneGas Welding Supply, LLC is one of many steps being undertaken by the executive team to prepare for the execution of this strategy in the near term," stated Scott Mahoney, C.F.O. of MagneGas Corporation.
About MagneGas Corporation
MagneGas® Corporation (MNGA) owns a patented process that converts various renewables and liquid wastes into MagneGas fuels. These fuels can be used as an alternative to natural gas or for metal cutting. The Company's testing has shown that its metal cutting fuel "MagneGas2®" is faster, cleaner and more productive than other alternatives on the market. It is also cost effective and safe to use with little changeover costs. The Company currently sells MagneGas2® into the metal working market as a replacement to acetylene.
The Company also sells equipment for the sterilization of bio-contaminated liquid waste for various industrial and agricultural markets. In addition, the Company is developing a variety of ancillary uses for MagneGas® fuels utilizing its high flame temperature for co-combustion of hydrocarbon fuels and other advanced applications. For more information on MagneGas®, please visit the Company's website at http://www.MagneGas.com.
The Company distributes MagneGas2® through Independent Distributors in the U.S. and through its wholly-owned distributor, Equipment Sales and Services, Inc. ("ESSI"). ESSI has four locations in Florida and distributes MagneGas2®, industrial gases and welding supplies. For more information on ESSI, please visit the company's website at http://www.weldingsupplytampa.com.
This press release contains forward-looking statements as defined within Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements relate to future events, including our ability to raise capital, or to our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. We assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. The Company is currently using virgin vegetable oil to produce fuel while it configures its systems to properly process waste within local regulatory requirements.
For a discussion of these risks and uncertainties, please see our filings with the Securities and Exchange Commission. Our public filings with the SEC are available from commercial document retrieval services and at the website maintained by the SEC at http://www.sec.gov.
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SOURCE MagneGas Corporation