Despite disappointing quarterly results, shares of Martha Stewart Living Omnimedia, Inc. (MSO) jumped 17% to close at $7.19 Tuesday after the company reached an agreement to purchase all non-restaurant assets related to the business of Emeril Lagasse. The Emeril Lagasse franchise, including television programming, cookbooks, and kitchen and food products was purchased for $45 million in cash and $5 million in stock.

The transaction is expected to close in the second quarter. In 2007, the business to be acquired generated approximately $14 million in cash-basis revenue. Martha Stewart Living Omnimedia did not purchase rights to Lagasse’s 11 restaurants or his corporate office.

“Emeril’s high-quality food-related content and product lines complement our own, and offer multi-platform expansion opportunities,” said Susan Lyne, President and CEO of Martha Stewart Living Omnimedia. “He brings to the [Martha Stewart Living Omnimedia] fold a well-managed company with highly attractive EBITDA and cash flow levels that will contribute immediately to our performance. This acquisition is a significant one strategically as we expand and diversify our business by applying our expertise in managing multi-platform lifestyle brands.”

The Emeril Lagasse acquisition was a sweet treat for investors, overshadowing bitter fourth quarter earnings that missed analyst expectations by 2 cents. Net income jumped to 63 cents per share, or $33.4 million, from 31 cents per share, or $16.6 million in the prior-year period. The New York-based media company, however, reported a 22% increase in fourth quarter revenue to $118.5 million, led by double-digit growth in its publishing, merchandising and internet segments.

Martha Stewart Living Omnimedia wrapped up a busy Tuesday by also announcing a 40% stake in online wedding planner WeddingWire in a move to expand its Weddings franchise online and in print.

Let us hear your thoughts below: