Live Ventures makes offer to buy LL Flooring Holdings - letter

Ll Flooring Holdings

12/10/2023 13:00

By Svea Herbst-Bayliss
       NEW YORK, Oct 12 (Reuters) - U.S. investment firm Live
Ventures  LIVE.O  has offered to buy LL Flooring Holdings Inc
 LL.N , formerly known as Lumber Liquidators, for roughly $180
million in cash, according to a letter seen by Reuters.
    LL Flooring said in August that it was exploring strategic
alternatives, including a possible sale.
    The company, headquartered in Richmond, Virginia and one of
the country's leading retailers of hard-wood surface flooring,
has seen its stock price tumble more than 78% in the last five
years. Live Ventures' offer of $5.85 per share represents a
roughly 100% premium to LL Flooring's closing price on
Wednesday. 
    "We fear that the Company's stock price will continue its
decline unless LL Flooring enters into a transaction with a
well-capitalized acquiror that has extensive experience working
with synergistic retailers in the near term," Live Ventures CEO
Jon Isaac wrote to the company's board. 
    Given Live Ventures' "experience, capabilities and track
record of value creation," Isaac added his company would be "the
best partner" for LL Flooring.   
    LL Flooring and Live Ventures did not immediately respond to
Reuters' request for comment.
    Live Ventures, which owns Flooring Liquidators and Marquis
Industries, reported approximately $290 million in sales and
roughly $40 million in adjusted earnings last year. Its stock
price is up more than 273% over the past five years. 
    In 2019, LL Flooring agreed to pay $33 million to settle
with the U.S. Department of Justice and the Securities and
Exchange Commission, after the company faced lawsuits related to
allegations it sold flooring that contained illegally high
levels of formaldehyde. Formaldehyde, used in making building
materials, is a known carcinogen.
    Live Ventures focuses on acquisitions of U.S.-based middle
market companies and is concentrating on the flooring segment.
"A transaction between Live Ventures and LL Flooring, which
includes 442 stores spanning 47 states across the U.S., would
therefore be synergistic given our extensive portfolio of
flooring companies," Isaac wrote.
    If the acquisition goes through, Live Ventures would be one
of the top five flooring retailers in the U.S on a revenue
basis.
    

 (Reporting by Svea Herbst-Bayliss; Editing by Rashmi Aich)
 ((svea.herbst@thomsonreuters.com; +617 233 2138; Reuters
Messaging: svea.herbst.thomsonreuters.com@reuters.net))