TEL AVIV – HUB Cyber Security Ltd. (NASDAQ: HUBC) is reportedly advancing toward a settlement in a $12 million dispute over unpaid fees with Oppenheimer & Co., related to services provided for a SPAC merger. The Israel-based cybersecurity firm, known for its advanced data protection and encrypted computing solutions, confirmed progress in resolving the claims. However, the terms of the potential settlement have not been disclosed.
The dispute stems from a service agreement between HUB Cyber Security and the financial services firm Oppenheimer & Co., which was engaged to assist in a SPAC (Special Purpose Acquisition Company) merger. Such mergers allow private companies to become publicly traded without going through the traditional initial public offering process.
Founded in 2017 by veterans of the Israeli Defense Forces' elite intelligence units, HUB Cyber Security specializes in confidential computing cybersecurity solutions to prevent data breaches at the hardware level. The company operates in more than 30 countries, offering a suite of cybersecurity services globally.
HUB Cyber Security has faced several challenges, including the impact of the war between Israel and Hamas that started in October 2023, which could potentially harm Israel's economy and the company's business operations. Additionally, the company has acknowledged uncertainties regarding its liquidity and capital resources, as well as the ability to meet its financial obligations.
This article is based on the press release issued by HUB Cyber Security.
In other recent news, HUB Cyber Security Ltd. has been making significant strides in the cybersecurity sector. The company recently secured an $8 million straight debt arrangement to bolster its financial base and support growth initiatives. In addition, HUB Cyber Security has also successfully secured a $2 million contract with the Israel Airports Authority to provide supervision services and engineering design consultancy across all Airports Authority sites in Israel.
On another note, HUB Cyber Security has teamed up with BlackSwan Technologies to showcase its Secured Data Fabric (SDF) solution at the upcoming Money 20/20 event. The SDF solution is designed to allow secure access to sensitive data across various industries.
However, the company has also announced a delay in the filing of its annual financial statements for the fiscal year ended December 31, 2023, citing the need for additional time to complete the audit process following its recent strategic acquisition of QPoint and ongoing debt restructuring efforts.
Meanwhile, the company has also responded to legal actions initiated by Dominion, labeling the actions as frivolous and without merit. HUB Cyber Security has filed a counterclaim in New York, alleging misconduct by Dominion.
InvestingPro Insights
As HUB Cyber Security Ltd. (NASDAQ: HUBC) navigates its legal dispute with Oppenheimer & Co., investors are closely monitoring the company's financial health and market performance. According to real-time data from InvestingPro, HUBC's market capitalization stands at a modest $7.75M USD, reflecting the challenges the company has faced. The firm's revenue over the last twelve months as of Q2 2023 is reported at $73.04M USD, with a slight growth of 4.47%. However, the company's gross profit margin during the same period is low at 0.61%, which aligns with one of the InvestingPro Tips indicating weak gross profit margins.
The company's stock has also experienced significant price volatility, another point highlighted by InvestingPro Tips. This is evidenced by a considerable 57.21% decline in the 6-month price total return as of the second quarter of 2024. Moreover, the price of HUBC shares has dropped to just 8.47% of its 52-week high, which might signal a buying opportunity for some investors, especially considering the InvestingPro Fair Value estimate at $1.05 USD, notably higher than the previous close price of $0.8 USD.
For investors and analysts seeking a deeper understanding of HUBC's financial position and stock performance, InvestingPro offers additional insights. There are 11 more InvestingPro Tips available that can shed light on the company's debt burden, cash burn rate, and valuation multiples. These tips could provide valuable context for the company's current situation and future outlook. For those interested in accessing these tips, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
It is crucial for stakeholders to consider these financial metrics and expert analyses when assessing HUBC's potential settlement impact and future business strategies. The company's ability to overcome its current financial challenges and capitalize on growth initiatives will be key to its success in the competitive cybersecurity market.
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