As I said earlier, I'm not so sure. I don't think that MLA has ever divulged the value of their OEM business let alone and specific customer -e.g,: carefusion. I think that the OEM business was far bigger than any of us knew. In the announcement back in February, Ellis said that Carefusion was a "meaningful amount of annual revenue" - just how big and what sort of margin was generated we don't know. Even if as IMsparticus has suggested that margins for this business were lower than for the rest it probably made a significant contribution to covering overheads - far more than were attributed to it.
The 4E comes out before the end of the month. My guess is that rather than generating more cash, MLA will start consuming cash, at least for the next quarter or two, until they build up new revenues. The question is if they burn cash, can they fund new business let alone acquire any new ones.
In the absence of a better cash offer I will be voting for the scheme. (BTW - I'm not interested in any scrip offer, I will make my own decisions where I invest!)
MLA Price at posting:
8.2¢ Sentiment: Hold Disclosure: Held
