(Telestock) – Bryant R. RileyChairman, Co-CEO and largest shareholder, has submitted a letter to the board of B.Riley Financiala US investment bank, proposing to acquire all the common shares of the company that it does not currently own for a purchase price of $7 per share (a 40% premium to the current price), with the aim of delisting the shares from the Nasdaq.
The banker owns currently about 24% of outstanding common stock. His letter notes that the company went public at $5 per share through a merger with Great American Group in 2014 and has since returned more than $20 to shareholders, including dividends and share repurchases. Over the past three years, the team has generated more than $1.1 billion in operating EBITDA.
“Despite our history of strong execution and value creation, the current paradigm of public companies requires that we focus on short-term objectives and that we spend unnecessary attention and time on groups of people who are not aligned with the owners of the company – the letter reads – Accordingly, while I am extremely confident in the company’s ability to continue to successfully execute our strategy, I believe that the company, its customers and its employees would benefit greatly from private ownership of the company”.
On Monday the stocks are dropped by 52% after B. Riley announced a loss of between $435 million and $475 million for the quarter ended in June. It also warned that it could record an impairment charge of between $330 million and $370 million in the quarter related to its investment in Vitamin Shoppe, parent company of Franchise Group.