Why Is Multistack Discontinuing Its Core Business After Asset Sale?
Multistack International has announced the discontinuation of its current business operations following a significant asset sale that settled a $3.55 million loan, signaling a major strategic shift for the company.
- No chiller sales recorded in Q2 2025; revenue from spare parts only
- Super Link Company Limited exercised option to acquire Verdicorp assets
- Loan of AUD 3.55 million fully settled through asset sale
- Board decides to discontinue current business due to ongoing losses
- Plans underway for SuperLink to acquire all shares in Multistack Australia
Quarterly Performance and Revenue
Multistack International Limited (ASX – MSI), a player in the industrial machinery sector specialising in water-cooled and air-cooled chillers, reported a quiet second quarter for 2025. The company recorded no sales of its core chiller products during this period, with revenue generated solely from spare parts sales. This lack of product sales underscores ongoing challenges in the company’s principal business activities.
Asset Sale and Loan Repayment
A pivotal development during the quarter was the exercise of an option by Super Link Company Limited, a related party to key stakeholders S. Yan and S. Leung, to acquire Verdicorp’s assets, including its Organic Rankine Cycle (ORC) technology. This transaction, approved by shareholders in 2023, resulted in the complete discharge of Multistack’s loan obligations amounting to approximately AUD 3.55 million. The settlement marks a significant reduction in the company’s debt burden and reflects a strategic realignment of its asset base.
Strategic Shift and Business Discontinuation
Following a thorough review, the Board has concluded that the company’s ongoing operations are not commercially viable without substantial capital injections, which are currently beyond the company’s capacity to secure. As a result, the Board has resolved to discontinue the business in its present form. This decision signals a major turning point for Multistack, as it moves away from its traditional operational model.
Future Plans and Shareholder Considerations
Looking ahead, Multistack will collaborate with Super Link on a potential acquisition of all shares in Multistack Australia. This process will require mutual agreement, completion of definitive documentation, shareholder approval, and an independent expert’s report to comply with regulatory requirements. Despite these changes, the company intends to continue operating prudently as a going concern and maintain compliance with all ASX reporting obligations during the transition period.
Financial Position and Loan Repayments
At the end of the quarter, Multistack held cash reserves of approximately AUD 1.54 million. Operating expenses for the quarter totaled around AUD 283,627, covering trading, staff, administration, and corporate costs. Additionally, the company fully repaid a USD 650,000 loan from a related party, further strengthening its balance sheet as it navigates this period of transformation.
Bottom Line?
Multistack’s strategic pivot and asset sale mark a critical juncture, with investor focus now on the outcome of the proposed acquisition and future business direction.
Questions in the middle?
- What are the detailed terms and timeline for SuperLink’s proposed acquisition of Multistack Australia?
- How will the company’s discontinuation affect existing contracts and customer relationships?
- What new business model or strategy might emerge post-discontinuation?
