Houston Wire & Cable Company Completes Sale of Southwest Wire Rope Division

Rhea-AI Summary

Houston Wire & Cable Company (Nasdaq: HWCC) announced the completion of its sale of the Southwest Wire Rope business for $5 million, excluding $2.9 million in trade accounts receivable, which HWCC retained. With net proceeds of approximately $3.4 million, the company aimed to reduce its revolver debt significantly. Following this transaction, HWCC's proforma revolver debt is estimated at $15.4 million, marking a reduction of $70.5 million compared to Q1 2020. This sale reflects HWCC's commitment to debt reduction and financial stability.

Positive

• Completed sale of Southwest Wire Rope for $5 million, enhancing liquidity.
• Proforma revolver debt reduced to $15.4 million, down $70.5 million from Q1 2020.

Negative

• None.

HOUSTON, March 15, 2021 (GLOBE NEWSWIRE) -- Houston Wire & Cable Company (Nasdaq: HWCC) today announced that it completed the sale of its Southwest Wire Rope business, a leading provider of lifting slings and wire rope and rigging products, for a purchase price of $5 million, subject to a working capital adjustment. The sale excluded approximately $2.9 million of trade accounts receivable, which HWCC retained. HWCC used the net sales proceeds of approximately $3.4 million to further reduce revolver debt.

James L. Pokluda III, HWCC President & CEO commented, “We are pleased that we were able to complete the sale of Southwest Wire Rope and, as communicated in prior releases, applied all sale transaction proceeds towards the reduction of debt. The company has made remarkable revolver debt reduction progress over the last twelve months. Including the $3.4 million received, and collection of the estimated $2.9 million of trade accounts receivable, we estimate proforma revolver debt to be $15.4 million, which is a reduction of $70.5 million versus the close of the first quarter 2020.”

About the Company

With 45 years’ experience in the industry, Houston Wire & Cable Company, an industrial distributor, is a large provider of products in the U.S. market. Headquartered in Houston, Texas, the Company has sales and distribution facilities strategically located throughout the United States.

Standard stock items available for immediate delivery include continuous and interlocked armor cable; instrumentation cable; medium voltage cable; high temperature wire; portable cord; power cable; primary and secondary aluminum distribution cable; private branded products, including LifeGuard™, a low-smoke, zero-halogen cable; and corrosion resistant fasteners, hose clamps, and rivets.

Comprehensive value-added services include same-day shipping, knowledgeable sales staff, inventory management programs, just-in-time delivery, logistics support, customized online ordering capabilities and 24/7/365 service.

Source: Houston Wire & Cable Company 

FAQ

What was the sale price of HWCC's Southwest Wire Rope business?

The sale price was $5 million.

What was retained by HWCC after the sale of Southwest Wire Rope?

HWCC retained approximately $2.9 million in trade accounts receivable.

How much has HWCC's revolver debt reduced after the sale?

HWCC's revolver debt has reduced by $70.5 million, now estimated at $15.4 million.

When was the sale of Southwest Wire Rope announced by HWCC?

The sale was announced on March 15, 2021.