F9 Investments, holding an 8.85% stake in LL Flooring, has launched a campaign urging shareholders to support their three nominees at the upcoming July 10 Annual Meeting. The move comes amidst LL Flooring’s severe financial woes, including a record low stock price and impending liquidity issues that may lead to bankruptcy. To navigate these challenges, LL Flooring has engaged AlixPartners for financial advisory.
Despite receiving offers substantially higher than the current stock price, LL Flooring’s board has declined these bids, a decision criticized by F9 Investments. They argue that new leadership is imperative to reverse the company’s decline and restore shareholder value. Proxy advisory firms Glass Lewis and ISS have endorsed F9’s nominees, bolstering their case for change.
Shareholders are encouraged to vote using the GOLD proxy card provided by F9 Investments or to amend their prior votes accordingly. LL Flooring’s stock has plummeted by 85.4% since the beginning of 2024 and a staggering 97.3% over the past three years. The company’s disclosure of potential bankruptcy and liquidity constraints further underscores the urgency of the situation.
Additionally, LL Flooring’s intention to enter into a sale-leaseback arrangement for its primary asset raises concerns about increased expenses and potential long-term value erosion for shareholders. F9 Investments contends that under the current board’s leadership, there has been significant value destruction, culminating in the stock closing at just $0.56 per share on July 5, 2024.
In summary, F9 Investments’ call for leadership change at LL Flooring is driven by the need to address critical financial and operational challenges, safeguard shareholder interests, and steer the company towards stability and growth.
