Cycurion Closes Kustom Video-Solutions Deal, Adding Over $5M in Revenue and $1.2M in EBITDA
CYCU has more than doubled off its 52-week low of $0.26.
Summary
Cycurion closed its acquisition of Kustom Entertainment's video-solutions business, adding over $5M in annual revenue and $1.2M in EBITDA. The deal was funded with cash, debt, and convertible preferred stock priced at a premium to the current market.
Key Events · M&A and Partnerships · CYCU
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Acquisition Closed
On August 3, 2026, Cycurion completed the purchase of Kustom Entertainment's video-solutions division for $1.25M cash, a $4.25M secured promissory note, up to $1M in earnouts, and $600K stated value of Series H Preferred Stock.
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Financial Impact
The acquired business is expected to add over $5M in annual revenue and $1.2M in EBITDA, bringing Cycurion's pro forma revenue run rate to approximately $30M. The Series H Preferred Stock converts at $1.45/share, a premium to the current $0.80 stock price, potentially adding ~413,793 shares if converted.
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Deal Structure & Dilution
The $600K in Series H Preferred Stock replaced 2,000,000 warrants originally contemplated. The preferred stock accrues 12% dividends and is convertible at $1.45/share. A leak-out agreement limits sales to 10% of daily trading volume for 12 months after a resale registration statement becomes effective.
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Earnout & Clawback Provisions
The seller can earn up to $500K per year (max $1M) if revenue exceeds $5.5M (2026) and $5.8M (2027) targets. Cycurion can claw back up to $500K per year if revenue falls more than 20% below those targets.
Analysis · CYCU · Technology
Cycurion completed its acquisition of Kustom Entertainment's video-solutions division, paying $1.25M in cash, issuing a $4.25M secured note, and granting $600K in convertible preferred stock. The deal is expected to add over $5 million in annual revenue and $1.2 million in EBITDA, pushing Cycurion's pro forma revenue run rate to approximately $30 million. The preferred stock converts at $1.45 per share — a premium to the current $0.80 stock price — and is subject to a leak-out agreement that limits selling pressure. This acquisition is a major step in Cycurion's aggressive roll-up strategy, but it comes against a backdrop of going-concern warnings and heavy recent dilution, making the integration and revenue delivery critical.
At the time of this filing, CYCU was trading at $0.80 on NASDAQ in the Technology sector, with a market capitalization of approximately $9.5M. The 52-week trading range was $0.26 to $16.03. This filing was assessed with positive market sentiment and an importance score of 9 out of 10.