InterCloud Systems Inc (OTCMKTS:ICLD) a major provider of cloud networking arrangement and automation services and solutions reported the sale of the High Wire Networks segment of ADEX Corporation. High Wire unit contracted with telecom infrastructure manufacturers to fit the manufacturer’s goods.
The buzz
InterCloud reported that the asset was initially bought by ADEX in 2014 for not more than $1 million and accounted for almost $11 million in yearly revenue in 2016. As per the terms of this reported asset sale, the company obtained $4 million in cash and is anticipated to get an additional working capital correction of almost $0.9 million, to be compensated in six months. The funds from this sale were utilized to mitigate secured outstanding debt.
Mark Munro, the CEO of InterCloud reported that the sale of non-core business property is a continued realignment of company’s business plan and reduction of outstanding liabilities. This sale has given company an opportunity to continue to enhance balance sheet and reduce convertible debt leading in shareholder dilution. The company is continuing to seek other non-core asset sales and conventional asset dependent lending solution, to lower the exposure to outstanding convertible debentures.
The news is an encouraging development from a shareholder perspective. InterCloud shareholders have to suffer quite severe losses in the last one year – and the step seems to have brought a degree of sentiment reassessment.
For investors new to this firm, InterCloud comes in the list of those tech firms that isn’t specifically good at getting its detailed story across to non-technical shareholders. However, analysts have stated it before, and they intend to repeat it again – this is a concerns that is spread across the tech space.
The company has seen higher volume in its shares as of late, as lenders used their privileges to convert debt into equity.
