The transaction may not have brought operating profits on day one, but, as I see it, BWMG made an acquisition with no cash out of pocket. $350K via a note (being paid back from forward earnings) and $1.4 million paid with common stock. The acquisition brought with it nearly $500K in cash and improved the working capital of the consolidated companies by over $800K. The only debt the acquired company carried was a PPP loan that was forgiven as of October.
This transaction clearly strengthened the balance sheet of the combined entities. Additionally, the acquired company was profitable in 2019 before COVID, and by the looks of the June 30, 2021 revenues, it is recovering.
From a balance sheet strengthening view, and the expansion of the business this was a great transaction for the company.
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