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MIAMI, FL – MSP Recovery, Inc. ("MSPR"), a technology solutions provider with a market capitalization of $17.23 million, has been notified by the Nasdaq Stock Market LLC ("Nasdaq") that it is currently not in compliance with the minimum stockholders’ equity requirement for continued listing on the Nasdaq Capital Market. According to InvestingPro data, the company faces significant financial challenges, with an EBITDA of -$37.24 million and a concerning current ratio of 0.01. The company’s stockholders’ equity was reported to be in a deficit of ($128,409,000) as of the year ended December 31, 2024, falling short of the required minimum of $2.5 million.
The Nasdaq notice, dated April 24, 2025, also indicated that MSP Recovery does not meet alternative compliance standards, which include having a market value of listed securities of $35 million or net income from continuing operations of $500,000 in the most recently completed fiscal year or in two of the last three most recently completed fiscal years. InvestingPro analysis reveals the company is quickly burning through cash, with negative free cash flow of -$16.65 million in the last twelve months.
MSP Recovery has until June 9, 2025, to submit a plan to regain compliance with the Nasdaq’s listing rule 5550(b)(1). If the plan is accepted, Nasdaq may grant an extension of up to 180 calendar days from April 24, 2025, to meet the requirements. In the event that the plan is not accepted, the company has the right to appeal the decision to a Nasdaq hearings panel.
The notice from Nasdaq does not affect the immediate listing of MSP Recovery’s common stock, which will continue to be listed and traded on the Nasdaq Capital Market, provided the company complies with other listing requirements.
This development follows MSP Recovery’s previous transitions, known formerly as Lionheart Acquisition Corp. II and Lionheart Acquisition Corp., with name changes occurring on July 24, 2020, and February 5, 2020, respectively. InvestingPro subscribers can access 12 additional key insights about MSPR’s financial health, including detailed analysis of its debt structure and growth prospects. Unlock comprehensive financial analysis and make informed investment decisions with InvestingPro’s advanced metrics and expert insights.
The information provided in this article is based on MSP Recovery’s recent SEC filing.
In other recent news, MSP Recovery, Inc. has announced a comprehensive restructuring plan to address its financial obligations and secure new funding. The company has entered into a significant agreement to create a new subsidiary, New Servicer, which will manage recovery efforts and receive up to $25 million in working capital from Hazel’s affiliate starting in September 2025. Additionally, MSP Recovery has secured $9.75 million in bridge financing from Hazel to support its restructuring process, with a commitment from the company’s principals to pledge $25 million in collateral. In a related move, Virage Recovery Master LP has agreed to waive claims against MSP Recovery in exchange for a 43% equity interest, and the company’s principals will convert $144 million of debt into Class A Common Stock. The restructuring also involves Virage acquiring a 33 1/3% stake in MSP Recovery’s Class A Common Stock, altering the company’s ownership structure. Virage will grant proxy voting rights to the MRCS Principals, allowing them to retain control over 51% of the total outstanding Class A Common Stock. Furthermore, MSP Recovery has amended its agreement with Yorkville, extending the maturity date of convertible notes to November 30, 2026, and allowing for potential capital raising through share sales. These developments reflect MSP Recovery’s strategic efforts to streamline its financial commitments and enhance its capital structure.
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