LL Flooring’s board of directors voted unanimously to reject an unsolicited bid from Cabinets To Go, a company owned by LL Flooring’s founder and former CEO Tom Sullivan. LL Flooring said the bid “significantly undervalues” the company.
Cabinets To Go made a proposal late last month to purchase LL Flooring’s outstanding shares for $5.76 per share in cash.
“The Board unanimously determined that the proposal significantly undervalues the worth of LL Flooring, its business and prospects and is not in the best interests of the company and its shareholders,” LL Flooring stated June 26, announcing the board’s rejection of the proposal.
Sullivan exited LL Flooring, formerly Lumber Liquidators, in 2017 and has twice attempted to buy his former company back. His latest bid caused LL Flooring’s stock to jump 21%.
LL Flooring Chairperson Nancy Taylor’s letter of rejection to Sullivan June 26 stressed that LL Flooring’s “future is bright” and called Sullivan’s bid “opportunistically timed” to benefit Cabinets To Go.
“If you were to significantly increase your $5.76 per share proposal to a level that is reflective of the value of the Company, we will consider it consistent with the Board’s fiduciary responsibilities and provide you with confidential information pursuant to a customary non-disclosure and standstill agreement,” Taylor stated.
