LL Flooring Board of Directors Unanimously Rejects Unsolicited Proposal from Cabinets To Go, Subsidiary of F9 Brands, Inc.
Proposal Significantly Undervalues LL Flooring and is Not in the Best Interests of Shareholders
LL Flooring Board Remains Open Minded to All Opportunities to Enhance Value
No Shareholder Action Required at this Time
LL Flooring Holdings, Inc. (“LL Flooring” or “Company”) (NYSE: LL) today announced that its Board of Directors has unanimously rejected an unsolicited, non-binding proposal from Cabinets To Go, LLC (“Cabinets To Go”), a subsidiary of F9 Brands, Inc., to acquire all of LL Flooring’s outstanding shares for
The LL Flooring Board and management team are committed to enhancing shareholder value and regularly review the Company’s strategic alternatives and assess opportunities to further this objective. Consistent with its fiduciary duties and in consultation with its financial and legal advisors, upon receipt, the LL Flooring Board carefully reviewed and considered Cabinets To Go’s non-binding proposal. 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. The Board is always open to considering a transaction that appropriately reflects the Company’s value and prospects.
Independent Chairperson of the Board, Nancy Taylor, said, “The LL Flooring Board of Directors is committed to enhancing shareholder value and we are open-minded about the best path to achieve this objective. The Board undertook a comprehensive review of the Cabinets To Go proposal and determined that it significantly undervalues LL Flooring. We remain open to engaging further on any opportunity that we believe will deliver appropriate value to all our shareholders.”
Ms. Taylor added, “LL Flooring’s unique positioning differentiates it from others in the market, and the Board and management team are confident in the Company’s business plan as it continues to deliver the high-touch service of an independent flooring retailer combined with the value and convenience of a national brand. LL Flooring is executing on its six core growth strategies and is well positioned to take advantage of the medium- to long-term tailwinds for repair and remodel spending.”
The Board of Directors communicated its response to F9 Investments and Cabinets To Go in the following letter on June 26, 2023:
F9 Investments, LLC
844 Alton Road
Attn: Tom Sullivan, Sole Manager
Cabinets To Go, LLC
2350 W O Smith Street
Attn: Jason Delves, Chief Executive Officer
Dear Messrs. Sullivan and Delves:
I am writing this letter on behalf of the Board of Directors (the “Board”) of LL Flooring Holdings, Inc. (“LL Flooring” or the “Company”) in response to your letter, dated May 26, 2023, regarding your interest in acquiring LL Flooring. Since receiving your indication of interest, the Board has met several times and, with the assistance of our independent financial advisor, JP Morgan Chase & Co., and our legal advisor, Skadden, Arps, Slate, Meagher & Flom LLP, carefully reviewed and considered it along with a variety of factors and information.
Following our comprehensive review process, the Board is unanimous in its belief that the price of
Nonetheless, the Board is deeply committed to enhancing value for all of our stockholders and receptive to opportunities that will help us achieve that goal. In that spirit, the Board is open to discussions about a transaction that adequately reflects the value of LL Flooring’s business and prospects as well as the significant benefits that would accrue to F9 Investments, LLC and Cabinets To Go, LLC as a result of an acquisition of LL Flooring.
If you were to significantly increase your
If you have an interest in communicating further on this basis, feel free to contact me at your earliest convenience.
Very truly yours,
Nancy M. Taylor
J.P. Morgan Securities LLC is serving as financial advisor, and Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal advisor to the Company.
About LL Flooring
LL Flooring is one of the country’s leading specialty retailers of hard-surface flooring with more than 440 stores nationwide. The Company seeks to offer the best customer experience online and in stores, with more than 500 varieties of hard-surface floors featuring a range of quality styles and on-trend designs. LL Flooring's online tools also help empower customers to find the right solution for the space they've envisioned. LL Flooring's extensive selection includes waterproof hybrid resilient, waterproof vinyl plank, solid and engineered hardwood, laminate, bamboo, porcelain tile, and cork, with a wide range of flooring enhancements and accessories to complement. LL Flooring stores are staffed with flooring experts who provide advice, Pro partnership services and installation options for all of LL Flooring's products, the majority of which is in stock and ready for delivery.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This press release includes statements of the Company’s expectations, intentions, plans and beliefs that constitute “forward-looking statements” within the meanings of the Private Securities Litigation Reform Act of 1995. These statements, which may be identified by words such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “thinks,” “estimates,” “seeks,” “predicts,” “could,” “projects,” “potential” and other similar terms and phrases, are based on the beliefs of the Company’s management, as well as assumptions made by, and information currently available to, the Company’s management as of the date of such statements. These statements are subject to risks and uncertainties, all of which are difficult to predict and many of which are beyond the Company’s control.
The Company specifically disclaims any obligation to update these statements, which speak only as of the dates on which such statements are made, except as may be required under the federal securities laws. For a discussion of the risks and uncertainties that could cause actual results to differ from those contained in the forward-looking statements, see the “Risk Factors” section of the Company’s annual report on Form 10-K for the year ended December 31, 2022, and the Company’s other filings with the Securities and Exchange Commission (“SEC”). Such filings are available on the SEC’s website at www.sec.gov and the Company’s Investor Relations website at https://investors.llflooring.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20230625961885/en/
For further information:
LL Flooring Investor Relations
ICR
Bruce Williams
ir@llflooring.com
Tel: 804-420-9801
For media inquiries:
Leigh
Joele Frank, Wilkinson Brimmer Katcher
212-355-4449
Source: LL Flooring Holdings, Inc.
