Because that's what decent LL.com will sell for.
Recent sales for reference:
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Mind you that most businesses don't want their brands abbreviated unless it's long. There's a reason why Weight Watchers changed back to weightwatchers.com from ww.com.
LL.com are valuable mainly because of the sheer amount of potential use-cases. But do you think blackrock.com would trade their domain for br.com? Of course not.
No one wants to share their profits.
And there's a good chance that there were other options on the table. If this opportunity was lost then the domain may never have sold. 1.2M is fair for tp.com.