I view this deal as good and bad. The good is $10million in cash to keep the companies that are losing money going until they hopefully get turned around. The bad news is that we are taking the one profitable entity, the carpet company, and saddling it with over $900K/yr in lease payments.
The verdict on whether this is a good deal, will be later, when we see what LIVE does with the $10 million and whether the stock goes up. All the good news so far, has resulted in the stock going down since I bought around $2 a few weeks ago. Short term, this will hurt profits but the market isn't valuing LIVE at any reasonable value for Q1 eps so I'm going to hold and see if they can repeat Q1. If they do anything close to Q1 for the rest of the year, we will have a winner.
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