The LiveTiles Ltd (ASX:LVT) share price is sinking lower on Thursday after settling its legal proceedings for $8 million plus 16.3 million shares…
The post Why the LiveTiles (ASX:LVT) share price is tumbling lower today. appeared first on Motley Fool Australia. –
The LiveTiles Ltd (ASX: LVT) share price has come under pressure on Thursday morning.
In early trade the intranet and workplace technology software provider’s shares are down 2.5% to 21 cents.
Why is the LiveTiles share price sinking lower?
Investors have been selling the company’s shares following an announcement after the market close on Wednesday in relation to legal proceedings.
In mid 2018, the company revealed that the company had been added to proceedings concerning a shareholder dispute in respect to companies unrelated to LiveTiles and involving the cofounders of LiveTiles. The proceedings were brought by CEO Karl Redenbach’s brother, Mr Keith Redenbach.
At that point, LiveTiles advised that it regarded the claim as frivolous and without merit.
Unfortunately, things didn’t stay that way and the company has just announced the settlement of the legal proceedings, at some cost.
According to the release, under the terms of the settlement agreement, LiveTiles will pay $8.445 million to the plaintiffs, and the LiveTiles Co-Founders Karl Redenbach and Peter Nguyen-Brown will transfer a total of 16,279,070 ordinary shares in the company to a nominee of the plaintiffs. Approximately 11.9 million of these shares will be subject to voluntary escrow conditions.
At the end of FY 2020, LiveTiles posted a statutory net loss of $31.6 million, leaving it with a cash balance of $37.8 million. This settlement will reduce its cash position to below $30 million, before taking into account any cash burn during the first quarter.
LiveTiles’ Co-Founder and Chief Executive Officer, Karl Redenbach, was pleased to resolve the matter. He also revealed that the company had a strong first quarter.
He commented: “We are pleased to resolve this matter, and to focus all of our attention and energy on the continued growth of LiveTiles. We have just completed a very successful quarter with a strong cash balance and look forward to sharing the results with shareholders in our Appendix 4C update and investor conference call next week.“
Man who said buy Kogan shares at $3.63 says buy these 3 ASX stocks now
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
In this FREE STOCK REPORT, Scott just revealed what he believes are the 3 ASX stocks for the post COVID world that investors should buy right now while they still can. These stocks are trading at dirt-cheap prices and Scott thinks these could really go gangbusters as we move into ‘the new normal’.
*Returns as of 6/8/2020
- Global Pension Index author Dr David Knox: “Take control of your retirement”
- Why the Resolute Mining (ASX:RSG) share price is the worst performer on the ASX 200 today
- Here’s why the Piedmont Lithium (ASX:PLL) share price is dropping lower today
- Why Saracen (ASX:SAR) is on track to achieve FY21 guidance
- Why the Healius (ASX:HLS) share price surged to a record high today
James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of LIVETILES FPO. The Motley Fool Australia has recommended LIVETILES FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.