On Tuesday, CleanCore Solutions, Inc (NYSE:ZONE) announced it has executed a definitive agreement to acquire Sanzonate Europe Ltd, a distributor of aqueous ozone cleaning technologies in Europe.

CleanCore has secured the deal primarily through a seller-financed carryback note and an earnout, minimizing upfront costs and aligning incentives for future growth.

The financing terms include a cash payment of $600,000, a $625,000 promissory note, due in two years at 10% interest, and annual earnout payments for 5 years totaling up to $1,250,000 (approximately 10% payment for every $2 million in sales).

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CleanCore expects to gain approximately $500,000 in inventory and $450,000 in accounts receivable as part of the acquisition.

The company believes this strategic acquisition will deliver immediate accretion, drive higher-margin revenue growth, and unlock a substantial multi-million-dollar sales pipeline.

Sanzonate currently has over 30 distribution partners and direct customers and a net backlog of over $10 million. The acquisition will unlock a sales pipeline of approximately $20+ million, providing future visibility into top-line growth.

The transaction will likely eliminate intermediaries, improving gross margins and EBITDA.

CleanCore will not assume any liabilities, ensuring a clean balance sheet post-transaction. CleanCore expects to gain complete control of Europe's largest aqueous ozone distribution network.

The company believes that acquiring the Sanzonate infrastructure and personnel will position CleanCore for rapid scalability across Asia, South America, and other key international markets.

CleanCore believes the proposed acquisition will align with Europe's focus on green cleaning solutions.

With the full integration of Sanzonate's established distribution network, a seasoned EU-based leadership team, and an untapped backlog of demand, CleanCore will likely solidify its position as the global leader in sustainable cleaning solutions.

The company believes the acquisition will give it direct control over Europe's largest aqueous ozone distribution network, allowing it to capitalize on Europe's accelerating corporate sustainability and green initiatives.

The acquisition's completion is subject to several conditions. It will likely close by March 7, 2025.

CleanCore Solutions held $0.56 million in cash and equivalents as of December 31, 2024.

Price Action: ZONE stock closed lower by 0.93% at $1.07 Monday.

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