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Dear Friends and Colleagues:
As mid-year approaches, we are pleased to report that activity at B. Riley & Co. has increased, with significant news to report.
We are taking advantage of the extraordinary number of talented financial professionals who have become displaced due to the economic recession and are actively hiring for our various offices. We have recently made new hires in our San Francisco, New York and Los Angeles offices.
Specific announcements to introduce these new professionals will be forthcoming.
Below is an overview of the more noteworthy developments:
NEWS FROM INVESTMENT BANKING
- $400 million SPAC
On May 14, 2009, it was announced that B. Riley is serving as financial advisor to Great American Group LLC in its sale to Alternative Asset Management Acquisition Corp. (NYSE Amex: Units: "AMV.U") in a $400 million SPAC. Great American Group, a privately-held company based in Los Angeles, is a leading provider of asset disposition. This SPAC transaction adds to the more than 350 engagements that B. Riley has successfully completed in a variety of industry sectors. Our expertise in the consumer and specialty retail sector allows us to represent Great American with a deep understanding of the industry.
Retained by major domestic bank
B. Riley has been retained to advise a major domestic bank on the restructuring of one of its industry portfolios, which is in excess of $1 billion.
You may recall that B. Riley launched its Financial Institutions Group (FIG) in September 2007 in anticipation of what we believed would be a significant upheaval in the banking industry, and the investment opportunities that would inure therefrom.
Located in our Philadelphia and Los Angeles offices, the FIG group includes a team of dedicated sales, equity research and investment banking professionals.
- OTCQX DAD appointment
B. Riley has qualified to become a DAD (Designated Advisor for Disclosure) under the OTCQX—and in our first such deal we are acting as a DAD for Proxim Wireless Corporation (OTCQX: PRXM). We intend to pursue more DAD relationships with companies that are proactive in maintaining good corporate governance and are sensitive to shareholder needs for transparency.
- Corporate Governance Group launched:
In February 2009, we announced the launch of the Corporate Governance Advisory Services Group. Focused on improving corporate governance at select companies, the group will lead institutional investors through the process of unlocking value at portfolio companies by obtaining Board representation and/or concessions with respect to strategic alternatives. Conversely, the group will also advise companies on ways to implement value-maximizing initiatives acceptable to both managers and shareholders.
We launched this group at the prompting of disconcerted institutional investors, but also have been engaged by several senior management teams and boards of directors.
NEWS FROM RESEARCH
Though we’ve grown considerably and diversified over the years, independent, quality research is where we started. It’s where we made our name and it continues to be a core focus of the firm. In February, 2009 B. Riley earned top research rankings from Integrity Research Associates for the performance of our research recommendations. We were the only firm to take the top spot in three sectors: Basic Materials, Consumer Services and Financials.
- Annual Investor Conference:
In March 2009, B. Riley held its 10th Annual Investor Conference which featured approximately 120 companies. Though other firms had cancelled their conferences, we forged ahead believing that difficult markets require more communication between companies and shareholders, not less.
The conference also featured information-rich sessions for both companies and investors. It wasn’t a surprise that the two most popular were the panel on Shareholder Activism and the session forecasting trends in commercial real estate, which also discussed the pending credit crisis.
- Banking Conference:
In keeping with our commitment to provide investors with timely, actionable information, B. Riley took the lead and held a special banking conference in November 2008 in NYC, the epicenter of the financial meltdown. The one-day mini conference featured a dozen banks from diverse regions throughout the mainland US and Puerto Rico. It also brought together major leaders in the banking and commercial mortgage sector who offered their perspective on the types of banking reforms and regulations that investors could anticipate during an Obama Presidency and a Democrat-controlled Congress.
CONCLUSION:
As we navigate through this global recession, we are faced with many challenges. Like so many other industries, we in financial services continue to see the disintegration of some well known firms—and with it the displacement of some very talented professionals.
We have always been “value” players—seeking and discovering companies with good management and strong balance sheets. At times, that has made us contrarians, but we always believed that those would be the companies that could best weather economic turmoil and would provide the best prospect for growth.
Economic change—even turmoil—presents opportunities. We are now pursuing those opportunities to hire new talent, to provide our advisory services to those with troubled portfolios, to handle alternative financings and to pursue corporate governance.
As always, if you have any questions please do not hesitate to contact us.
Sincerely,
Bryant R. Riley
Chairman
B. Riley & Co.
310-966-1444
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