Noble Iron Inc. has entered into a binding agreement to sell its Houston, TX equipment sales and rental business. Pursuant to the Agreement, the Company has sold all of its shares of Noble Rents (TX), Inc., which operates the Houston operations, to an arm’s-length third party. Noble Iron will continue to operate and grow its equipment rental and sales operations in Southern California and other regions, as well as its software platform, Texada Software.
The purchase price for the Houston business is US $6.24 million. As part of the transaction, the purchaser has assumed an existing asset backed credit facility in the principal amount of US $5.63 million. The net proceeds to the Company are US $0.61 million, of which US $0.5 million is in cash and US$.11 million is in the form of an unsecured promissory note, due in November 2017 at an interest rate of 3% per annum.
Nabil Kassam, Noble Iron’s founder, chairman and CEO, commented, “in consideration of the current state of Houston’s challenged economy and the relatively small size of our Houston equipment operations, we feel this sale is positive as it is an opportunity to reduce outstanding debt and to better position us to focus on scaling our software and equipment logistics and fulfillment operations in Southern California as we enter into 2017. We at Noble Iron are committed to executing our goal of offering regional construction professionals the most comprehensive selection of equipment and services on-demand, because of a synergistic combination of our logistics infrastructure, equipment service capability, shared asset marketplace, and state-of-the-art software.”