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Liquid Audio: Better off dead?

Posted by chrisd on from the well-yeah dept.

mgeneral writes "It seems so for the shareholders. Liquid Audio, had only $150,000 in revenue but managed to lose $5.6 million last quarter. Its main asset: A pile of cash. In fact, so much cash, that if they close the doors, they could pay back the shareholders more per share than the current stockprice...and thats exactly what some investors want them to do." We've run stories on Liquid Audio before...

3 of 172 comments (clear)

  1. They still exist? by saihung · · Score: 5, Interesting

    It would be refreshing to see the directors of a company admit that they have no idea how they can make any money and return whatever their investors ponied up. The shareholders own the company, and if there's not even a glimmer of hope of the company ever being profitable (with Liquid I'm not sure that there ever was, but that's a separate issue) then the best thing is to admit defeat, cut your losses while there's still anything to cut, and close your doors.

    1. Re:They still exist? by squaretorus · · Score: 4, Interesting

      Wrong.

      The best thing is to find a new board of directors WHO HAVE A CLUE!

      Take easyJet. One of the most profitable and successful companies to come out of the internet age. All tickets booked online, along with some other innovations, allowed far cheaper seats, leading to a massive chunk of market share, even buying Go recently (Go was the British Airways budget airline).

      Stelios, the guy that set up easyJet, has left his position at the head of the company and will completely leave next year. EasyJet has brought in a team and a headman who know how to RUN a business, not just START IT UP. Stelios is off to start another business, easyJet is on its way to another successful year.

      With that kind of cash reserve, even with no IPR, facilities, or brand, you simply need an ambitious board with some GOOD ideas and the capability to pull it off.

      Then the shareholders should get much more than $1 for every $.7 in return. Easier said than done of course.

  2. Re:The buyout stinks by cyberlotnet · · Score: 4, Interesting

    Ok before you take the time to try to post a smart comment to gather more karma.. READ THE STORY FULLY..

    They don't only get $3.00 per share, they also get stock in the new combined company...

    So they lose .40 cents per share, for the chance to make more money in the future.. This is the reason they invested there money in the first place...

    What we have here is a couple of stock buyers scared of the current market and looking to bail out all together, And in this case try to force every other stock holder to do the same.

    If instead they would hold on to the stock and "ride the wave" They have a chance at better returns in the future.

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