ILUS Stock – Adopting a Growth by Acquisition Model
Through its growth-by-acquisition model, ILUS International Inc.(OTC:ILUS) has a main focus on acquiring and developing emergency services and life safety technologies across the world. Despite providing a series of solid updates regarding its growth plans for Q2, ILUS stock is notably oversold and could be a dip buy ahead of its planned catalysts. Currently in talks with an acquisition target generating over $100 million per year, ILUS is a stock to watch as it works to uplist to a major exchange.
January: ILUS Stock News
ILUS has already completed multiple acquisitions in 2021 and is kicking off the new year with a promise of four exciting announcements. Aiming to expand globally, the company has laid the groundwork to complete at least one acquisition per quarter. With this in mind, ILUS intends to establish a conglomerate of four to five NASDAQ listed companies which it has already reached pre-contract agreement on. Upon completing the agreement, this initiative is expected to generate a significant return on the ILUS balance sheet – which could push the stock’s value even higher.
As of now, ILUS is already in the final stage of two prominent technology company acquisitions – both of which could pave the way for greater success. By acquiring a prominent public safety VR and AR training software company, ILUS could be well-positioned to penetrate the $500 billion Metaverse market. Given that the target company is known for developing disruptive firefighting technology and has existing customers in seven countries, this acquisition could give ILUS a competitive edge in fire safety training within the Metaverse.
Aside from its ventures into the metaverse, ILUS is also in the process of acquiring a pioneering Unmanned Aerial Vehicle (UAV) company based in Germany. The target company is known for developing and manufacturing the first ever UAVs or Industrial Drones that deliver the unmanned capability of light helicopters. After finalizing prototypes, the company is currently undergoing a proof of concept for a project with an international aid organization and continues to garner serious interest from several aviation companies around the world. With an average projected valuation of $1.2 billion, this acquisition could prove lucrative for ILUS.
As anticipation brews ahead of the company’s annual shareholder meeting on the 28th, fintwit investors are speculating Emergency Response Technologies could be ILUS’ first target company positioned for a NASDAQ uplisting. Although the company is yet to confirm the news, investors are already feeling bullish given ILUS’ history of successful acquisitions.
In fact, one of the company’s major acquisitions – BCD Fire recently started operating on the second phase of the BURJ 2020 – bringing an additional $1 million to the company via its contract. The BURJ 2020 is a promising project that includes work on Dubai’s top commercial developments. Following this success, BCD Fire is targeting several other large contracts in the region including TakeLeap and Milanion. Meanwhile, Bull Head Products – a truck design and manufacturing company – is in the process of signing a $1.1 million contract in Mississippi and is positioned to take advantage of long-term ongoing contracts with a yet-to-be-disclosed prominent global vehicle company.
In addition, the company’s first acquisition – FireBug has recently announced the launch of the first handheld firefighting nozzle – Maxi A-1. The unique product is designed to extinguish most fire types including electric fires, fuel fires, flammable gas fires, and cooking oil fires. Standard firefighting nozzles are not capable of efficiently extinguishing many of those fire types without the use of added chemicals, giving Maxi A-1 a competitive edge over other industry players.
Backwell is bullish on the company’s efforts saying: “the US strategy is coming together nicely and the valuation of these ‘tech’ acquisitions will be mind-blowing.” He believes that the upcoming acquisition candidates “will put ILUS on track to deliver even more than originally planned for this year.”
Beside its success in the domestic market, ILUS is also working on an extremely promising European deal that involves long-term government supply contracts. Already approved at European government level, ILUS is planning on finishing two phases of the project before EOY. The first phase is expected to include the acquisition of a huge manufacturing site to develop a commercial electric utility vehicle (UTV) range – which could open a plethora of opportunities for the company’s growth.
Meanwhile, in the second phase, the company is planning on taking over existing government manufacturing facilities staffed with over 1500 employees. These facilities will be dedicated to developing vehicles for the military and emergency responders. Growth in Europe could lead to the company achieving higher revenues and getting closer to its aims of global growth.
To facilitate this and prepare for larger deals in the future, ILUS has been investing in upscaling its labor force with recent notable hires in the engineering, production, and operations departments. Furthermore, ILUS has been forming partnerships that complement its current acquisitions and ongoing strategy in the emergency response space.
February: ILUS Stock News
*Update on February 16th
Having already completed several acquisitions, ILUS has assured investors it has plans to acquire many more companies from different emerging industries. As of February 15th, the company announced its acquisition of Georgia Fire and Rescue Supply – a renowned distributor of firefighting and emergency response equipment. This marks ILUS’ first distribution acquisition and is the first step in expanding the company’s technology across North America.
This acquisition is already looking promising given that the acquired company has zero debt and an annual turnover of $3.5 million. Additionally, the company has several exclusive Georgian distribution contracts for the sales and servicing of global firefighting equipment brands – including Holmatro, Innotex and Paratech. Georgia Fire is also bringing in an experienced 7-member sales team – all of whom are retained firefighters with technical knowledge and experience within the industry and a solid understanding on how to penetrate the US market.
Currently, the acquired company is operating from its 6,000 square foot distribution warehouse. However, to facilitate further expansion, ILUS has plans to move Georgia Fire into a 15 thousand square foot distribution facility with a showroom and a dedicated vehicle yard. Managing Director – John-Paul Backwell is “excited to welcome Georgia Fire to the family as it marks the beginning of the company’s real “boots on the ground” US rollout.”
The company is now in a strong cash position to deliver on its current and future plans given that it recently signed three funding deals for a total of $15 million. The company secured funding after a period of extensive due diligence by the funders – RB Capital, Discover Fund, and Luki Ventures – all of which are known for funding high-growth tech companies.
Brett Rosen – RB Capital’s Managing Partner – highlighted his belief in ILUS saying: “We invest in people and their teams, and Link is the type of leader we believe can move the company forward with the right capital behind him.” Truly, CEO Nick Link believes this funding will drive the company’s “overall aggressive growth and acquisition strategy as we remain focused on protecting the best interests of our shareholders and our long-term sustainability.”
To ensure shareholder value, ILUS emphasized that no dilution will occur as a result of this funding – which was secured through repayable, 1-year term, non-toxic promissory notes. This funding includes a cash warrant option for an additional $6 million – should the company require it. As of February 15th, the company has confirmed it has received the first two rounds of funding and expects to receive the third round before EOM.
Additionally, ILUS plans to utilize some of the funding to remove the GPL Ventures, LLC debt and discard them as a noteholder from the company. With this in place, the company could be well-equipped to expand its operations, ramp up marketing and production and also complete its next round of acquisitions.
Following this, ILUS confirmed that phase 1 of its Southeastern Europe deal is expected to close by EOM and that the company expects to receive massive subsidies within the next few weeks. Upon the deal closing, ILUS will be moving into a large government facility – which will facilitate greater production and R&D of the company’s brand new 2023 commercial EV range. At this rate, ILUS is well-positioned to take pre-orders for new vehicles by May 2022 and aims to take orders for up to 500 cars between then and EOY.
To prepare for this growth, the company has been working on improving its share structure. From its originally 1.2 billion OS, ILUS is currently undergoing a 180 million share reduction – 40 million of which will be canceled and the other 140 million are of the CEO’s common shares and will be transferred to a preferred share category. Following this, the company intends to issue three blocks of restricted shares for its previously completed acquisitions, however, outstanding shares will still remain within the 1.2 billion region and the company has assured investors of its efforts to reduce it to nearly 1 billion – including an opportunity for shareholders to lock up shares in a preferred category.
Currently, the company’s BOD is in discussions regarding upcoming acquisitions. Back in January, ILUS acquired Vira Drones – an Unmanned Aerial Vehicle (UAV) company based in Germany and Switzerland. Most known for its world first technology that delivers the unmanned capability of light helicopters, Vira is on track to become the world’s leading cargo and rescue drone manufacturer and is well-positioned to capitalize on the $13 billion light helicopter market in the process.
Vira’s two major competitors have already achieved valuations of $1.2 and $1.3 billion. However, the acquired company still has a competitive advantage given it has already created and tested 3 prototypes and has applied for several patents. This acquisition will allow ILUS to integrate its technology into its emergency response solutions and any other upcoming acquisitions. To facilitate this, ILUS is now focused on registering additional 10 patents as well as obtaining 3 type approval certificates. By doing this, the company could be well-positioned to receive aviation certification that could enable Vira Drones’ UAVs to fly commercially in inhabited areas.
The company’s managing Director highlighted that this is “one of several exciting deals that we have been working on in-line with the technology advancement strategy”. Additionally, Link is bullish on ILUS’ direction going forward given that “the valuation of this acquisition is mind blowing and it will play an important role in accelerating many of our upcoming plans.” In light of this, he assured investors that the company has a detailed roadmap for growth and that more deals will be announced soon.
Delivering on this, the company announced its sixth strategic acquisition days later. By acquiring KurveXR from TakeLeap – a futuristic technology company which creates artificial intelligence and machine learning solutions, ILUS is positioning itself as a player in the $500 billion metaverse market. This acquisition will enable the development and delivery of training solutions for public safety – ranging from fire and community safety to emergency response and corporate onboarding. Through that, ILUS could be well-equipped to become the first company to offer fire safety training in the metaverse.
ILUS’ CEO believes the addition of KurveXR to the company’s portfolio complements the recent acquisition of Vira Drones and allows the company to further advance its disruptive technology. He is bullish that “another acquisition will rapidly expand and achieve an extraordinarily high valuation.”
As of now, ILUS is planning several spin offs and is working on its first up listing. Given that ILUS plans to hold a 50-80% share of each up-listed company, investors are bullish the company could witness major financial growth in 2022. In light of this, ILUS‘s CEO highlighted the company’s commitment to “not only building a conglomerate but also ensuring that the creation of further value for shareholders along the process.”
March: ILUS Stock News
*Updated March 23rd
Aiming to grow internationally, ILUS is preparing to launch its renewables subsidiary – Replay Solutions – in Dubai and Serbia in Q2 as well as the US in Q4. The subsidiary’s operations will be initially based on urban mining with plans to add more assets to ILUS’s new division.
With the world looking for green technologies and solutions for extracting precious metals, Replay Solutions is set to capitalize on this need through its urban mining business. Through this, the company will recover precious metals from disposed electronics and treat them mechanically and chemically to produce new electronics without damaging the environment. Through its government contracts, Replay has already acquired a significant and consistent supply of raw materials to develop and implement the extraction and refinement of these precious metals.
Considering the rising demand for electronics has led to a shrinking supply of precious metals, ILUS’s renewables division is in a great position to capitalize on this expanding need. Studies have found that 7% of the world’s gold can be found in discarded electronics thanks in part to the 200 million cell phones thrown away in the US every year. In addition, studies in 27 countries have found that unused cell phones contain $2.5 billion worth of gold. In light of this largely untapped market, ILUS could witness major growth as its new business rolls out.
As for its US expansion plans, ILUS intends to operate through a franchise business model which will allow the company to have a centralized regional refining center in each state with several franchises supporting the regional refining center. According to this model, the franchisees will handle the collection of the state’s raw materials before delivering them to the regional center for the refinement process. ILUS’s management has achieved major success through this business model in the past and believes it will achieve similar success using it to facilitate this refinement process.
On top of this, ILUS plans to start a lithium recycling plant in its Serbia site to take advantage of the increasing demand for lithium batteries. To facilitate these plans, the company held talks with several companies which supply the world’s largest automotive manufacturers with batteries for their electric vehicles. So far, these companies have acknowledged their dwindling supplies and have shown a willingness to get their lithium supply from Serbia.
Currently, ILUS expects its plant machinery to be delivered to both its Dubai and Serbia sites in the near future, with operations scheduled to begin in May.
As a part of its plans to further expand in the Middle East, ILUS has recently opened a new office in Dubai to accommodate 75 staff members. At the same time, ILUS is exploring options for establishing offices and facilities in Riyadh, Saudi Arabia due to the increasing demand for the company’s products. ILUS also aims to secure contracts related to the $500 billion Saudi Arabian NEOM project.
The NEOM project is the start of a new smart city the Saudi government plans to build along the Red Sea. It will function as a tourist destination with revolutionary technology and new policies as envisioned by Mohammed Bin Salman according to the Saudi Vision 2030. Currently, the first phase of the project is scheduled to be completed in 2025.
With oil prices increasing, ILUS has been negotiating with oil and gas customers in the Middle East to provide its fire safety products to capitalize on this price increase. Considering its relationship with the region, ILUS’ subsidiaries witness major revenue growth in when oil prices increase. In light of this and the increasing demand for its defense vehicles due to the conflict in Ukraine – ILUS stock forecast 2022 is looking pretty bright.
April: ILUS Stock News
*Updated April 1st
As part of its European Phase 1 deal, ILUS acquired a manufacturing facility in Čačak, Serbia for ILUS EV Technologies – its first investment in the country. Through this facility, ILUS plans to manufacture its E-Raptor electric utility vehicles for commercial use in addition to EV component parts. With six different vehicle types, the E-Raptor will range from the 4×2 L7e to the top 6×6.
ILUS has chosen to operate in Čačak due to the city’s support of technology companies and its excellent location. With proximity to sea and airports, the city’s location will assist ILUS in selling its E-UTVs across Europe at minimal cost. Additionally, Serbia’s construction, labor, and energy costs are significantly lower than the rest of Europe. Combined with the government’s generous subsidies to companies located outside the capital of Belgrade, ILUS could record higher revenues thanks to its new facility.
Considering that the EV industry is growing rapidly, ILUS projects its new investment will generate hundreds of millions over the next 8 years. Link is bullish “this is ultimately to the greater benefit of ILUS and its shareholders” and promised “further information on the site and deal structure once the final administration is completed”.
To facilitate the expansion of its businesses on all fronts, ILUS is set to showcase its fire and rescue technologies at the world’s largest fire and rescue convention – FDIC International – in April. At this convention, ILUS will present technologies from its Emergency Response Technologies division – including vehicles and equipment from FireBug, Georgia Fire & Rescue Supply, and Bull Head Products. Additionally, the company intends to include a new firefighting equipment and vehicle company which the company plans to acquire in time for the convention.
Audit and Uplisting
The exposure this convention could bring to ILUS and its line of products could help bolster its revenue this year and bring more attention to the stock. But in terms of its finances, ILUS has appointed AJSH & Co as its auditors and expects to release its 2021 annual report this summer upon the completion of its audit. It is worth noting that AJSH & Co is known for uplisting a number of OTC companies to the NASDAQ.
Following the audit, the company will apply to uplist to the OTCQB as ILUS CEO Nick Link believes that “listing ILUS on the OTCQB will only attract even further interest from institutional investors and larger private investors.”
Recently, ILUS updated its shareholders on the status of its share structure and promised to make it visible on April 1st. Despite plans for a 180 million share reduction, the company still reported 1.2 billion OS. However, ILUS assured its shareholders that the share reduction is ongoing as the company still aims to reduce its OS to 1 billion shares.
*Updated April 26th
Communicative as ever, ILUS conducted a shareholder question and answer led by John-Paul Backwell – ILUS Managing Director. Over the course of the meeting, Backwell answered questions provided by the ILUS discord.
Plans for the Second Quarter
Since then it has shared its plans for Q2, giving a timeline for its name change and uplisting process. According to the company, its audit is underway and following its release the company will follow through on its official name change from “Ilustrato Pictures International Inc” to ILUS International Inc. It also expects to submit its filing for Q1 on May 15th which will document its acquisitions of Vira Drones, KurveXR, and Georgia Fire and Rescue Supply.
However, in Q2 it will mainly focus on its’ Emergency Response Technologies (ERT) subsidiary which was formed only six months ago. The current acquisitions or technologies within this subsidiary are FireBug, The Vehicle Converters, Georgia Fire and Rescue Supply, Bull Head Products, the rescue drones from within the Vira Drones range, as well as the VR trainings from KurveXR.
To sustain this subsidiary’s growth, the company has plans for multiple acquisitions – some of which have already been discussed. One of these upcoming acquisitions will be a wildfire company with sales in 70 countries and the second is an emergency response communications company. In addition to these, ILUS is already conducting its due diligence on a potential acquisition with over $100 million in annual revenue.
On that note – when asked in the Q&A how ILUS goes about an acquisition, Backwell explained that after a series of meetings evaluating an acquisition target, the company typically makes an offer equivalent to 30 – 70% of the company’s value to be paid on closing. The balance is then paid 12 months after closing as an aggregate payment. This happens if the company meets certain targets set by ILUS. For larger acquisitions, the deal may be structured over a period of 2 to 5 years but would also depend on the company meeting the targets specified as part of the acquisition.
However it depends on each company’s unique plans and while ILUS may offer convertible preference shares as part of the deal, these shares can only be sold after one or two years with a “leak out” clause potentially added to the agreement. Backwell went on to say that ILUS does not disclose all the details of the payment structure of these acquisitions so that potential, future acquisitions do not have set expectations based on ILUS’ previous acquisition agreements.
Meanwhile, ILUS appears set to act on its previous plans for establishing a defense division. Considering that the company has already been manufacturing firefighting equipment and vehicles for the defense sector, it is ready to become a more established player through a significant defense acquisition. According to the company, this acquisition target is “strategically aligned with revolutionary technology and has a large pipeline of global sales”.
Share Lock Up
The company also shared its plans to give shareholders the option of locking up shares of ILUS stock in a preference category. As a result of this share lock up, the company expects a reduction in its outstanding shares but will be releasing the details of this decision in the coming weeks. Shareholders will have the opportunity to indicate interest in locking up their shares of ILUS stock in the coming weeks and the share lock up which will begin in Q2.
Investors are excited for what this could mean for the company however there is a lot to consider in terms of how this share lock up could affect ILUS stock and incentives related to Emergency Response Technologies and other ILUS subsidiaries.
In addition to its Emergency Response, Integrated Systems, and Defense subsidiaries the company will be forming a Renewables subsidiary which will incorporate Replay Solutions. This urban mining business will commence operations from Serbia and Dubai during Q2 and the US in Q4.
Having established its core management team and its plant machinery for scaling on the way, Replay Solutions expects to have its sites in Serbia and Dubai fully operational by the start of May 2022.
Seeking a position in the US market from which to establish its own fire suppressions systems, ILUS has signed an LOI to acquire a fire suppression system company in Florida which generates roughly $3 million annually. Thanks to its regional ties, this acquisition target provides its services to well-known clients such as Universal and has recently been awarded significant new contracts. Currently it assembles, installs, and maintains fixed fire suppression systems for international hotel and restaurant chains but ILUS hopes to introduce its own water mist fire suppression technology in the US through it in the future.
As is, this acquisition will work with FireBug Technologies to accelerate its fire suppression product development and could complement the company’s Middle Eastern fire protection systems acquisition, BCD Fire, as well. On that note, ILUS’ team appears especially bullish on the acquisition and Backwell shared that he believes it is “poised to double its revenue year on year” at its current pace.
ILUS acquired KurveXR – a developer of public safety Virtual Reality and Augmented Reality solutions – in February and recently provided an update on the company’s developments so far. ILUS was eager to bring this company under its umbrella thanks to its applications for fire safety, emergency response, community safety, security, defense, and corporate onboarding. ILUS is interested in applying KurveXR’s technology to all sectors of the Emergency Response Management cycle and took ownership of 6,000 custom digital assets for training software through this acquisition.
ILUS notes that KurveXR has seen demand for its first aid and fire safety modules from potential customers such as international organizations, global hospitality brands and senior government officials. Now, KurveXR is developing modules for several military training scenarios, disaster management, wildland firefighting training, structural firefighting training, and rescue training
Based on contracts in discussion and contracts awarded, KurveXR is expected to surpass ILUS’ revenue expectations for its first 2 years. Notably, the company is expected to secure a health and safety training contract for more than 30 independent schools in the UAE. In light of this increased demand, KurveXR is building out its software development team in the UAE and South-eastern Europe.
With a number of significant acquisitions underway and plans for more, its clear that ILUS is working towards its goal of uplisting to a major stock exchange. Due to this goal, ILUS is reorganizing its various subsidiaries and has registered several entities in Delaware, including Emergency Response Technologies Inc, Vira Drones Inc, FireBug Technologies Inc, KurveXR Inc, E-Raptor Technologies Inc and ILUS Industries Inc. These different entities are designed to manage the subsidiaries and develop self-sufficient management teams to incubate the subsidiaries – creating an overall, comprehensive structure for ILUS as it works to uplist.
However, ILUS notes that despite these efforts it is running “slightly” behind schedule for its first planned participation on a major stock exchange. The company pointed to the complexity of the acquisition deals it is currently considering as part of the reason for the delay but also indicated that these deals “have increased the valuation potential of its subsidiaries”. This update comes as ILUS continues searching for its potential board members.
Due to its plans for uplisting, ILUS is also in discussions with several investment banks and “will announce the investment bank that it has chosen to partner with for its participation on a major stock exchange” once its reached a decision.
ILUS Stock Financials
According to its recent annual report, ILUS is showing significant financial progress. Recording total assets of $31 million and a net income of $13.9 million, the company has roughly $176 thousand in cash on hand. It’s worth noting that the company operated at a net loss of $160 thousand only a year ago so this progress is substantial. If ILUS succeeds in acquiring the company reportedly making over $100 million in annual revenue, then ILUS’ will be in a particularly strong position for uplisting.
Despite this progress, shareholders are anxious for ILUS to follow through on updating its share structure. According to an update on March 21st, ILUS expected its share structure to be updated at the start of April, however its profile has yet to reflect this change.
Once its 180 million share reduction is complete, the company expects its OS to remain near 1.2 billion due to the issuance of three blocks of restricted shares for acquisitions. However, the company will continue working towards reducing its OS to 1 billion. At the time ILUS reported an OS of 1.26 billion shares and an AS of 2 billion.
@MoonMarket_ is bullish on ILUS’ negotiations with a potential acquisition generating $100 million in revenue yearly
As long-term investors in ILUS, @Yenom99 and @SalsTradingOTC are frustrated by the outdated share structure
ILUS stock price is currently at $.112 with a primary support at .11 and a secondary support level from September at .0998. ILUS stock has an immediate resistance at .1355 and a secondary resistance near .1455. The RSI is very oversold at 25 and accumulation is downtrending rapidly. Meanwhile, the MACD is bearish but could be approaching a crossover.
Overall, ILUS stock has been stuck in a channel between .11 and .168 for the past several months, The RSI shows that the stock is currently massively oversold. Combining these 2 facts together, it would seem that now is a great opportunity to start a position in ILUS or average down. We can also see that in March in the presence of a strong catalyst, ILUS broke through the channel, this would indicate that once momentum returns to the OTC coupled with a strong catalyst, ILUS could revisit the .21 level for a 100% move from current levels. A break of the .21 level could send the stock on a parabolic run.
While the drop in accumulation is a sign of the OTC’s lack of momentum, ILUS stock could be bound for a rebound once it updates its share structure or provides more details about its potential acquisition which would form the cornerstone of its defense subsidiary.
ILUS Stock Forecast 2022
As the company continues to pursue acquisition opportunities and improve its organizational structure, many investors are confident ILUS stock will uplist. Working to generate value through its growth by acquisition model, ILUS is branching into various sectors through its Defense, Integrated Systems, Emergency Response Technologies, and Renewables subsidiaries.
If it succeeds in acquiring a company generating $100 million yearly, ILUS could be in an excellent position to capitalize on its foothold in these sectors. With its audited financials and name change scheduled for this summer, there are many catalysts ahead for ILUS stock.
If you have questions about ILUS stock and where it could be heading next feel free to reach out to us in our free alerts room!