MPower Reports $4.1M Loss as It Agrees to $19M Asset Sale
MPower Group Limited has announced a binding agreement to sell its main renewable energy assets for approximately $19 million, reporting a net loss of $4.1 million for FY2025 largely due to discontinued operations.
- Binding sale agreement with Wollemi Energy Group for $19 million
- Main assets classified as held for sale, including Lakeland Solar & Storage Project
- Net loss of $4.105 million for FY2025, driven by discontinued operations
- Continuing operations show no revenue and $0.3 million in corporate costs
- Post-sale plans include debt repayment and potential capital return or new acquisitions
Strategic Asset Sale Marks Turning Point
MPower Group Limited has taken a decisive step to reshape its future by entering into a binding agreement to sell substantially all of its assets to Wollemi Energy Group Pty Limited and Wollemi Climate Pty Ltd, a climate-focused investment firm. The transaction, valued at approximately $19 million in cash, includes MPower’s renewable energy platform, the Lakeland Solar & Storage Project, a pipeline of project opportunities, and its services business.
The sale agreement, announced in June 2025 and expected to complete by September 2025, is subject to several conditions including shareholder approval and operational milestones such as the re-energisation of the Lakeland project. All MPower employees have been offered employment with the buyer, signalling a transfer of operational continuity alongside the asset sale.
Financial Impact and Discontinued Operations
The company’s preliminary financial results for the year ended 30 June 2025 reveal a net loss of $4.105 million, primarily attributable to discontinued operations related to the assets held for sale. Continuing operations reported no revenue and incurred corporate costs of $0.3 million, underscoring the winding down of ongoing business activities.
MPower’s balance sheet reflects the impact of the sale classification, with assets of $14.6 million and liabilities of $19.2 million related to the main undertaking classified as held for sale. The company’s equity position remains negative at a deficiency of $4.715 million as of 30 June 2025, highlighting financial pressures ahead of the transaction’s completion.
Post-Sale Outlook and Strategic Options
Upon completion of the sale, MPower intends to use the proceeds to repay all outstanding liabilities, with an estimated surplus cash position of approximately $3.5 million. The company is considering several strategic pathways including returning capital to shareholders via buy-backs, capital reductions, or liquidation after the warranty claim period expires. Alternatively, MPower may pursue a backdoor listing through acquisition of a new business or a combination of these options.
This strategic divestment follows an extensive capital raising process where Wollemi emerged as the preferred partner, offering alignment with MPower’s scale and opportunity. The sale price includes a deferred payment of $2 million payable six months after completion, subject to agreed terms.
Investor Considerations and Market Implications
MPower’s FY2025 results and asset sale announcement represent a significant corporate restructuring with implications for shareholders, creditors, and employees. The company’s negative equity and net liabilities underscore the urgency of the transaction to restore financial stability. Investors will be watching closely for shareholder approval outcomes and the successful completion of conditions precedent.
While the sale offers a clear path to deleverage and potential shareholder returns, the delay in completion and additional costs incurred, including those related to the Lakeland project repairs, introduce execution risks. The company’s future beyond the sale remains open, with strategic decisions on capital return or new acquisitions to be made in the coming months.
Bottom Line?
MPower’s asset sale signals a pivotal restructuring phase, but execution risks and future strategic choices will shape its next chapter.
Questions in the middle?
- Will MPower shareholders approve the sale and under what terms?
- What are the prospects and timing for capital return or new business acquisition post-sale?
- How will the delay and additional costs impact the final cash proceeds and company liquidity?
