Shares of surface flooring and accessories provider LL Flooring Holdings (NYSE:LL) are tanking today after Founder Tom Sullivan withdrew his $5.76 per share takeover bid for the company due to its deteriorating financial and operational performance.
Sullivan made the acquisition offer in May this year through the F9 Group and Cabinets to Go (CTG) in a bid to combine LL and CTG. LL rejected the proposal in June, as it “significantly” undervalued the company.
Earlier this week, LL announced that it was exploring strategic alternatives, including a potential sale, merger, or other combinations. The company has not set a deadline for the completion of this process.
Having gone from consistent profitability to a negative bottom line last year, LL is expected to incur a net loss per share of $2.83 in 2023 versus an EPS of $1.39 in 2021.
In sync, shares of the company have cratered by nearly 62% over the past year. Meanwhile, Loop Capital Markets’ Laura Champine, the lone analyst covering LL, has reiterated a Sell rating on the stock alongside a $2 price target. This implies a further ~50% potential downside in LL shares.
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