E&A Limited reveals plan to save Nobles from liquidation, and 100 jobs

A crucial vote on the future of SA company Nobles will be held on Wednesday, with 100 jobs at stake – as an investment company aims to save it.

About 100 jobs will be at stake when creditors of embattled industrial company Nobles meet on Wednesday to vote on a rescue plan.

Adelaide-based investment company E&A Limited and Nobles chief executive Rhys Goldsworthy have revealed their plans to save the 111-year-old company from closure, after administrators were appointed to take control last month.

Under their deed of company arrangement (DOCA) proposal, EAL would assume control of Nobles, taking over most of the company’s assets and liabilities, including three properties in Roxby Downs and Karratha.

The company’s merchandising division would be closed down, but its core engineering, production and services arms would continue to operate.

About 55 employees, mostly in head office roles, would be let go, leaving a workforce of about 100 staff.

Administrator James McPherson of Meertens is recommending that creditors vote in favour of the DOCA, given it would provide unsecured creditors with an estimated dividend of up to 33 cents in the dollar.

Nobles’ headquarters on Grand Junction Rd in Kilburn. Picture: Supplied

Under the alternative scenario the company would be shut down and liquidated, leaving an estimated return of up to 18 cents.

“The DOCA is the optimum outcome for creditors as it provides for the highest return for all classes of creditors,” Mr McPherson says in a report to creditors ahead of Wednesday’s meeting.

“The employment of around 100 employees will be saved and the business will continue to provide its services, engineering and production functions for its long-established customer base.

“Should EAL be successful … and executes the DOCA, the company will have a net asset base of $1.77m, a new board and management team and a strategy for acquisition to grow shareholder value.”

EAL controls 10 wholly-owned subsidiaries across the mining, resources, defence, water, energy and financial services industries, employing more than 1400 people.

Its DOCA proposal requires that all Nobles shareholders agree to transfer their shares to the new ownership group without receiving a payment in return.

Mr McPherson said 83 per cent of shareholders had already agreed to give up their “worthless” shares, and under the Corporations Act he could seek court orders for the transfer of the remaining shares.

Nobles has close to 150 shareholders, with most of the company owned by extended members of the original Noble family.

The company’s 155 staff are owed $2.8m in unpaid entitlements and super.

As part of the proposal, EAL would take on those debts for employees retained by the company, while terminated staff would have their entitlements paid out in full.

Meanwhile, more than 600 unsecured creditors owed $5.2m will have their claims transferred to a creditors’ trust, to be repaid through the sale of assets not retained by the new ownership group.

Nobles, which supplies lifting and rigging products and services to the mining, oil & gas, defence and other industries, was established by founder George Adie Noble as a coal dust marketer to the foundry industry in 1911.

At its height the company employed close to 300 staff and was the country’s largest supplier of lifting and rigging services, designing, distributing and manufacturing products including wire ropes, synthetic and chain slings, hoisting equipment and other industrial components.

However the company struggled to bounce back from the end of the mining boom, and Covid-19 also played a role in its recent demise.

The company’s latest financial report reveals revenue slid to $43.8m in 2020-21, resulting in a $1.2m loss. A $3.4m loss was reported in 2019-20.

Mr Goldsworthy has been contacted for comment.