Multistack International Limited has announced plans to discontinue its current business operations and is working towards disposing of its Australian subsidiary after continued losses and cash burn.
- Q4 2025 sales included 2 water-cooled chillers and spare parts
- Board decided to discontinue business in current form due to sustained losses
- Disposal of Multistack Australia Pty Ltd underway, pending approvals
- Cash reserves stood at $1.1 million with quarterly operating expenses of $277,000
- Company holds a $696,000 non-interest bearing loan from a related party
Quarterly Performance and Sales
Multistack International Limited (ASX, MSI), a player in the HVAC equipment sector specialising in water-cooled and air-cooled chillers, reported modest sales during the October to December 2025 quarter. The company sold two water-cooled chillers alongside some spare parts, reflecting a subdued commercial activity in its core business.
Strategic Shift, Discontinuation of Current Business
In a significant strategic move, the Board has resolved to discontinue the business in its present form. This decision follows a thorough review of the company’s ongoing commercial viability, which remains challenged by persistent losses. The directors highlighted that any continuation would require a substantial capital injection, which exceeds the company’s capacity to raise funds. This marks a pivotal turning point for MSI as it seeks to stem further financial erosion.
Disposal of Australian Subsidiary
MSI is actively working on the disposal of its shares in Multistack Australia Pty Ltd. This process is contingent on mutual agreement with the prospective parties, completion of definitive legal documentation, shareholder approval, and the procurement of an independent expert’s report to satisfy regulatory requirements under the Corporations Act and ASX Listing Rules. During this transitional phase, the company intends to continue operating prudently as a going concern, maintaining compliance with all reporting obligations.
Financial Position and Related Party Loans
At the end of the quarter, MSI held cash and cash equivalents of approximately $1.1 million. Operating expenses for the quarter totalled $277,009, predominantly driven by staff, administration, and corporate costs. Notably, the company carries a non-interest bearing unsecured loan facility of $696,000 from ACR Equipment (HK) Ltd, a related party linked to key individuals within the company. This related party loan underscores the financial support structure underpinning MSI during this challenging period.
Looking Ahead
While the disposal process is underway, the lack of a definitive timeline and details on potential buyers leaves some uncertainty about the company’s future revenue streams and overall financial health. Investors will be watching closely for updates on shareholder approvals and the outcome of the disposal negotiations, which will be critical in shaping MSI’s next chapter.
Bottom Line?
Multistack’s exit from its Australian operations signals a critical restructuring phase that will test investor patience and market confidence.
Questions in the middle?
- Who are the potential buyers for Multistack Australia Pty Ltd, and what terms are being negotiated?
- What impact will the disposal have on MSI’s future revenue and profitability?
- How will the company manage its related party loan and capital requirements post-disposal?