Vesta Modular and Housing Solutions Inc., a portfolio company of Birmingham-based Simon Group Holdings, has purchased Salt Lake City-based M Space Holdings LLC out of bankruptcy for $15.3 million.
In a story the Daily Business News originally covered last year, M Space filed for bankruptcy in May 2016, blaming the decision by the Organization of Petroleum Exporting Countries in 2014 to not cut oil production, which lead to a steep cut in oil prices and a decline rents the company was receiving from its modular housing units in the shale fields of North Dakota.
The company stated monthly revenue from those units fell from $440,000 a month in late 2014 to about $104,000 a month by the spring of 2016.
This fall in revenue left M Space unable to service its debt.
According to Crain’s Detroit, Vesta beat out three other bidders for M Space, which holds more than $100 million in assets, including 1,700 modular housing units, office-space trailers and temporary classrooms around the country.
“This is the minnow eating the fish,” said Sam Simon, founder of Atlas Oil Co. in Taylor and CEO of Simon Group Holdings.
“I’m a big believer that business is all about the buy, not the sell, and this was a great buy for us.”
Simon said Vesta will close M Space’s Salt Lake City office but will retain most of its employees, growing its head count from six to about 20.
Soaring Pine Capital LLC, a funding arm of Simon Group Holdings, funded the acquisition.
Prior to the auction, Vesta owned about 300 modular units, including 76 modular classroom units it purchased out of bankruptcy in Florida and then immediately leased to the schools.
(Image credits are as shown above.)
Submitted by RC Williams to the Daily Business News for MHProNews.
