MIDLAND, Pa. - Mawson Infrastructure Group, Inc. (NASDAQ: MIGI), a digital infrastructure provider for AI and digital assets with a market capitalization of $12.85 million, is contesting an involuntary Chapter 11 bankruptcy petition filed against it by Australian entities. The company clarified that contrary to earlier reports, it has not voluntarily sought bankruptcy protection. According to InvestingPro data, MIGI's stock has experienced significant volatility, with shares trading near their 52-week low.
The involuntary petition was lodged by W Capital Advisors Pty Ltd and Marshall Investments MIG Pty Ltd, both Australian trustees. Mawson Infrastructure, which has not been formally served with the petition, plans to defend against the filing vigorously.
The company continues its normal operations and is executing its business plan, maintaining revenue growth of 25.45% over the last twelve months. It has raised concerns about the relationship between W Capital Advisors, former executive James Manning, and the company. Manning is currently under investigation by Mawson's Audit Committee for several matters, including litigation with a related entity, Vertua Property Inc. InvestingPro analysis indicates the company's overall financial health score is Fair, though its current ratio of 0.39 suggests tight liquidity.
Mawson has taken legal action against Vertua, alleging breach of lease agreement and interference with business relationships, seeking damages and reinstatement of a terminated lease. This legal dispute is part of ongoing proceedings in Australia, which Mawson believes are being used to gain leverage in the conflict.
As stated in an 8-K filing on March 29, 2024, Mawson had previously considered exiting its Australian entities and holdings. The company's operations are based in the United States, with no active sites or assets in Australia.
Mawson Infrastructure Group focuses on providing digital infrastructure platforms for various computing applications, emphasizing the use of carbon-free energy sources, including nuclear power. InvestingPro analysis suggests the stock is currently undervalued, with additional insights available through their premium service. Subscribers can access 12 more ProTips and detailed financial metrics to better understand the company's potential.
This news is based on a press release statement from Mawson Infrastructure Group, Inc.
In other recent news, Mawson Infrastructure Group Inc. reported a 65% year-over-year increase in revenue for September 2024, primarily driven by significant growth in its digital colocation business. The company's third-quarter sales stood at $12.6 million, with co-location revenue marking a 17% rise from the previous quarter. Mawson also disclosed an 18% increase in co-location revenue for October, amounting to $4.0 million.
Recent developments include Mawson's acquisition of land in Perry County, Ohio, and a 20MW NVIDIA (NASDAQ:NVDA) GPU support deal with BE Global Development, a London-based private equity firm. Upon completion, Mawson's total power under management is expected to reach 153MW. H.C. Wainwright maintained a Neutral rating for Mawson, expressing caution regarding the company's growth prospects and operating leverage.
The company has also secured a 6-year AI customer colocation agreement with NVIDIA, which could generate a cumulative revenue potential of $285 million. Additionally, Mawson extended its lease agreement with Jewel Acquisition, LLC for an 8-acre land in Midland, Pennsylvania, until 2027, and signed a marketing deal with Outside The Box Capital Inc.
On the executive front, CEO Rahul Mewawalla was granted 2,500,000 restricted stock units under the company's 2024 Omnibus Equity Incentive Plan. The company also announced the departure of Chief Development Officer Craig Hibbard and the appointments of Kaliste Saloom as General Counsel and Corporate Secretary, and former U.S. Congressman Ryan Costello as the new Chair of the Board of Directors.
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