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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): January 18, 2022
B. Riley Financial, Inc.
(Exact Name of Registrant as Specified in its Charter)
| Delaware | 001-37503 | 27-0223495 | ||
|
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
11100 Santa Monica Boulevard, Suite 800
Los Angeles, California 90025
(310) 966-1444
(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)
Former name or former address, if changed since last report: Not Applicable
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| Common Stock, par value $0.0001 per share | RILY | Nasdaq Global Market | ||
| Depositary Shares (each representing a 1/1000th interest in a 6.875% Series A Cumulative Perpetual Preferred Share, par value $0.0001 per share) | RILYP | Nasdaq Global Market | ||
| Depositary Shares (each representing a 1/1000th interest in a 7.375% Series B Cumulative Perpetual Preferred Share, par value $0.0001 per share) | RILYL | Nasdaq Global Market | ||
| 6.75% Senior Notes due 2024 | RILYO | Nasdaq Global Market | ||
| 6.50% Senior Notes due 2026 | RILYN | Nasdaq Global Market | ||
| 6.375% Senior Notes due 2025 | RILYM | Nasdaq Global Market | ||
| 6.00% Senior Notes due 2028 | RILYT | Nasdaq Global Market | ||
| 5.50% Senior Notes due 2026 | RILYK | Nasdaq Global Market | ||
| 5.25% Senior Notes due 2028 | RILYZ | Nasdaq Global Market | ||
| 5.00% Senior Notes due 2026 | RILYG | Nasdaq Global Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 3.02 | Unregistered Sale of Equity Securities |
The information set forth under Item 7.01 is incorporated herein by reference.
On January 19, 2022, in connection with the consummation of the transactions contemplated by the Purchase Agreement (as defined below) and as part of the total consideration described in the press release furnished as Exhibit 99.1 hereto, B. Riley Financial, Inc., a Delaware corporation (the “Company”), (i) issued 152,438 shares of its common stock, par value $0.0001 per share (“Common Stock”), to certain equityholders (the “Sellers”) of FocalPoint Securities, LLC (“FocalPoint”) and (ii) agreed to issue an additional 152,438 shares of Common Stock to the Sellers on January 19, 2025. The issuance of the shares of Common Stock pursuant to the Purchase Agreement was not or will not be registered under the Securities Act in reliance upon the exemption provided in Section 4(a)(2) of the Securities Act as no general solicitation was used in the offer and sale of the Common Stock. Pursuant to the Purchase Agreement, the Company agreed that, within five business days after the issuance of the shares of Common Stock, it will file or cause to be filed (at its sole cost and expense) one or more prospectus supplements to its then-existing effective automatic shelf registration statement registering for resale all of the shares of Common Stock issued to the Sellers.
| Item 7.01 | Regulation FD Disclosure |
On January 18, 2022, the Company entered into a Membership Interest Purchase Agreement (the “Purchase Agreement”) with FocalPoint, the Sellers and the other parties to the Purchase Agreement. The Purchase Agreement provides for the acquisition of all of the issued and outstanding membership interests of FocalPoint by the Company in exchange for cash and shares of Common Stock. The transactions contemplated by the Purchase Agreement were consummated on January 19, 2022.
On January 18, 2022, the Company and FocalPoint jointly issued a press release announcing the transaction. A copy of that press release is furnished as Exhibit 99.1 hereto and is incorporated herein by reference.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
| Exhibit No. | Description | |
| 99.1 | Press release, dated January 18, 2022 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| B. Riley Financial, Inc. | ||
| By: | /s/ Alan Forman | |
| Name: | Alan Forman | |
| Title: | General Counsel | |
Date: January 21, 2022
Exhibit 99.1
 |
 |
B. Riley Financial Announces Acquisition of FocalPoint
Securities, LLC,
A Leading Middle Market M&A Advisory Investment Bank
Transaction marks a major step toward creating the premier middle market-focused investment banking platform
LOS ANGELES, January 18, 2022 – B. Riley Financial, Inc. (NASDAQ: RILY) (“B. Riley” or the “Company”), a diversified provider of business advisory and financial services, today announced it has agreed to acquire FocalPoint Securities, LLC, a leading independent investment bank based in Los Angeles, for total consideration of up to $175 million. The transaction, which will create revenue synergies for both companies, comes as FocalPoint is experiencing significant momentum with $17 billon in closed transactions spanning a successful 20-year history. The combination is expected to more than quadruple B. Riley’s pro forma M&A advisory business, while significantly enhancing its debt capital markets and financial restructuring capabilities.
Founded in 2002, FocalPoint specializes in mergers and acquisitions (M&A), private capital advisory, financial restructuring, and special situation transactions. The firm includes approximately 50 investment banking professionals with deep industry specialization in high-growth sectors such as aerospace and defense (A&D), industrials, business services, consumer, healthcare, and technology/media/telecom (TMT). The combination of B. Riley and FocalPoint builds upon the momentum and proven execution capabilities of both firms and is in line with B. Riley’s stated intent to expand capabilities in M&A advisory and fixed income. This combination provides strategic and financial sponsor clients with access to both firms’ proven execution capabilities and a full suite of end-to-end services from a single platform.
Bryant Riley, Chairman and Co-Chief Executive Officer of B. Riley Financial, said: “FocalPoint is a world class firm known for its ability to handle complex deals with speed, accuracy, and quality. This combination builds on our long and successful track record of acquiring and integrating other complementary businesses that can provide us with additional scale and capabilities to expand our small and middle market leadership. With both companies having started off around the same time, in the same area of Southern California, and building meaningful niches within our industries, this deal carries special significance for me. We could not be more excited to welcome the FocalPoint team to B. Riley.”
“We’ve long admired the unique platform the B. Riley team has been building and are thrilled to now become an integral part of it. We have grown tremendously over the last 20 years and believe we will be able to compete even more aggressively in the marketplace going forward,” said Nishen Radia, co-founder of FocalPoint. Added co-founder Duane Stullich, “This transaction brings more breadth and depth to our teams in M&A, debt capital markets, and financial restructuring while maintaining the entrepreneurial and collegial culture that has made FocalPoint a success.”
According to Rajesh Sood, Managing Partner of FocalPoint, “The combination will allow us to provide greater opportunities for our people and provide our clients with access to meaningfully more products and services. We are thrilled to take this next step and look forward to the next chapter with B. Riley.”
Sullivan & Cromwell LLP acted as legal counsel to B. Riley Financial. Sidley Austin LLP and Sheppard, Mullin, Richter and Hampton LLP served as legal counsel to FocalPoint. Houlihan Lokey served as financial adviser to FocalPoint.
About FocalPoint Partners
FocalPoint is an independent investment bank specializing in mergers and acquisitions, private placements, financial restructurings, and special situation transactions. With offices in Los Angeles, Chicago, Dallas, New York, and Shanghai, the firm serves middle-market clients throughout the U.S. Securities products and services are offered through FocalPoint Securities, LLC. Member FINRA, SIPC. For more information, please visit www.focalpointllc.com and follow us on LinkedIn and Twitter.
About B. Riley Financial
B. Riley Financial provides collaborative solutions tailored to fit the capital raising and business advisory needs of its clients and partners. The Company operates through several subsidiaries that offer a diverse range of complementary end-to-end capabilities spanning investment banking and institutional brokerage, private wealth and investment management, financial consulting, corporate restructuring, operations management, risk and compliance, due diligence, forensic accounting, litigation support, appraisal and valuation, auction, and liquidation services. For more information, please visit www.brileyfin.com and follow us on LinkedIn and Twitter.
Forward-Looking Statements
Statements in this press release that are not descriptions of historical facts are forward-looking statements that are based on management's current expectations and assumptions and are subject to risks and uncertainties. If such risks or uncertainties materialize or such assumptions prove incorrect, our business, operating results, financial condition, and stock price could be materially negatively affected. You should not place undue reliance on such forward-looking statements, which are based on the information currently available to us and speak only as of the date of this press release. Such forward looking statements include, but are not limited to, statements regarding the terms and conditions, and expected results of the FocalPoint transaction, including regarding expected revenue synergies and the pro forma impact on our M&A advisory business. Factors that could cause actual results to differ include (without limitation) the risks associated with the unpredictable and ongoing impact of the COVID-19 pandemic, revenue synergies not being fully realized or take longer than expected to be realized, risks associated with integration, and other risks described from time to time in B. Riley Financial, Inc.'s periodic filings with the SEC, including, without limitation, the risks described in B. Riley Financial, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2020 and in our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2021, June 30, 2021 and September 30, 2021 under the captions "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" (as applicable). These factors should be considered carefully, and readers are cautioned not to place undue reliance on such forward-looking statements. All information is current as of the date this press release is issued, and B. Riley Financial, Inc. undertakes no duty to update this information.
Contacts
For B. Riley Financial
Investors
Mike Frank
ir@brileyfin.com
(212) 409-2424
Media
Jo Anne McCusker / Scott Cianciulli
press@brileyfin.com
(212) 739-6753
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Source: B. Riley Financial, Inc.