B. Riley Financial Stock Nearly Doubles in a Month
Sawtelle-based B. Riley Financial has experienced a dramatic rebound in its stock performance, with share prices nearly doubling over the past month. The company’s stock surged from $2.91 on June 17 to $5.79 by the close of trading on Thursday, marking a 99% increase. This upward momentum follows a series of strategic financial maneuvers aimed at reducing the company’s significant debt burden and shoring up investor confidence.
The financial firm, which faced scrutiny after a Securities and Exchange Commission (SEC) disclosure last August, has been working to rebuild its standing. The SEC investigation stemmed from B. Riley’s previous dealings with Franchise Group Inc., casting a shadow over the company’s operations for nearly a year. However, recent debt restructuring and divestitures have signaled a proactive approach to resolving these challenges.
Debt Reduction Through Strategic Exchanges
Most notably, B. Riley has entered into yet another deal with an institutional investor to cut down its debt. This latest agreement involves the exchange of $43 million in outstanding senior notes—originally set to mature between September 2026 and August 2028—for $25 million in newly issued 8% senior secured lien notes which will be due in January 2028. As part of the deal, the investor will also acquire approximately 98,000 common shares at $10 each.
This marks the fifth bond exchange that B. Riley has completed in the past four months, cumulatively reducing its total outstanding debt by approximately $126 million. Co-CEO and Chairman Bryant Riley stated, “We continue to address our capital structure and expect to utilize the remaining capacity under our senior secured second lien facility to improve our balance sheet further.”
Additional Financial Maneuvers
Earlier in the month, B. Riley struck another debt exchange agreement with a separate unnamed institutional investor. This transaction is expected to reduce the firm’s debt by an additional $15 million. These back-to-back deals reflect a clear strategy by the company to systematically decrease its $1.8 billion debt load reported at the end of 2024.
Further supporting this strategy, B. Riley amended a term loan agreement with Oaktree Capital Management, a prominent investment firm headquartered in downtown Los Angeles. The revised agreement, originally signed in February, offers increased flexibility, including a $100 million investment basket to facilitate new transactions and an expanded $30 million investment cap for parent company investments—up from a previous $20 million.
In addition to these measures, the firm will be able to use up to $25 million in cash to reduce other forms of debt, such as repurchasing unsecured notes, according to a press release issued on July 9.
Divestitures Strengthen Capital Position
To further bolster its financial position, B. Riley has sold off several business units. At the end of June, the firm finalized the sale of GlassRatner Advisory & Capital Group—which operates under the name B. Riley Advisory Services—as well as B. Riley Farber Advisory Inc. The assets were sold for $117.8 million to funds managed by TorQuest Partners, a Canadian investment firm.
B. Riley originally acquired GlassRatner in 2018. The advisory firm specialized in restructuring, forensic accounting, and bankruptcy services. The divestiture is part of B. Riley’s broader initiative to concentrate resources on core business segments, specifically B. Riley Securities and B. Riley Wealth Management.
“Divesting GlassRatner will provide additional capital to support growth initiatives and strengthen our capital structure,” said Bryant Riley in a statement. “Maximizing shareholder value through ongoing reinvestment in our business remains a critical priority.”
Outlook and Investor Sentiment
The series of strategic actions taken by B. Riley appear to be resonating with investors, as evidenced by the near 100% increase in stock price over a 30-day period. By addressing long-standing debt issues and refocusing its business model, the firm is making strides toward financial stabilization and future growth.
Analysts and shareholders alike will likely continue to watch how B. Riley leverages its improved capital structure in the coming quarters. With a more streamlined balance sheet and a renewed emphasis on core business areas, the company is positioning itself for a potential turnaround after a tumultuous year.
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