The Great American Group Launches as New Independent Business Following Formation of Partnership between Oaktree and B. Riley
B. Riley Financial and Oaktree Capital Management announced the launch of Great American Group as an independent business following their partnership formation. B. Riley received approximately $203 million in cash, Class B Preferred Units with an initial liquidation preference of about $183 million, and Class A Common Units representing roughly 47% of total outstanding common units. The company expects to record a $235 million gain on this investment in Q4 2024. The transaction allows B. Riley to reduce its debt while maintaining significant equity in the business.
B. Riley Financial e Oaktree Capital Management hanno annunciato il lancio di Great American Group come attività indipendente in seguito alla formazione della loro partnership. B. Riley ha ricevuto approssimativamente $203 milioni in contante, Unità Preferenziali di Classe B con una preferenza di liquidazione iniziale di circa $183 milioni, e Unità Comuni di Classe A che rappresentano circa il 47% del totale delle unità comuni in circolazione. L'azienda prevede di registrare un guadagno di $235 milioni su questo investimento nel quarto trimestre del 2024. La transazione consente a B. Riley di ridurre il debito mantenendo un'adeguata quota di capitale nell'attività.
B. Riley Financial y Oaktree Capital Management anunciaron el lanzamiento de Great American Group como un negocio independiente tras la formación de su asociación. B. Riley recibió aproximadamente $203 millones en efectivo, Unidades Preferentes Clase B con una preferencia de liquidación inicial de aproximadamente $183 millones, y Unidades Comunes Clase A que representan alrededor del 47% del total de unidades comunes en circulación. La compañía espera registrar una ganancia de $235 millones sobre esta inversión en el cuarto trimestre de 2024. La transacción permite a B. Riley reducir su deuda mientras mantiene una participación significativa en el negocio.
B. Riley Financial과 Oaktree Capital Management는 파트너십 체결 후 Great American Group을 독립적인 사업으로 출범한다고 발표했습니다. B. Riley는 약 $203 백만의 현금, 초기 청산 우선권이 약 $183 백만인 B 클래스 우선주, 그리고 총 발행된 보통주 중 약 47%를 대표하는 A 클래스 보통주를 수령했습니다. 이 회사는 2024년 4분기에 이 투자에 대해 $235 백만의 이익을 기록할 것으로 예상하고 있습니다. 거래를 통해 B. Riley는 부채를 줄이면서 사업에서 상당한 자본을 유지할 수 있습니다.
B. Riley Financial et Oaktree Capital Management ont annoncé le lancement de Great American Group en tant qu'entreprise indépendante faisant suite à la formation de leur partenariat. B. Riley a reçu environ $203 millions en espèces, des unités préférentielles de classe B avec une préférence de liquidation initiale d'environ $183 millions, et des unités ordinaires de classe A représentant environ 47% du total des unités ordinaires émises. L'entreprise s'attend à enregistrer un gain de $235 millions sur cet investissement au quatrième trimestre 2024. La transaction permet à B. Riley de réduire sa dette tout en conservant une part significative dans l'entreprise.
B. Riley Financial und Oaktree Capital Management haben die Gründung von Great American Group als unabhängiges Unternehmen bekannt gegeben, nachdem sie ihre Partnerschaft gebildet haben. B. Riley erhielt ungefähr $203 Millionen in bar, Class-B-Vorzugsanteile mit einer anfänglichen Liquidationspräferenz von rund $183 Millionen, und Class-A-Stammaktien, die etwa 47% der insgesamt ausstehenden Stammaktien repräsentieren. Das Unternehmen erwartet, im vierten Quartal 2024 einen Gewinn von $235 Millionen aus dieser Investition zu verbuchen. Die Transaktion ermöglicht es B. Riley, seine Schulden zu reduzieren und gleichzeitig erhebliche Eigenkapitalanteile im Unternehmen zu halten.
- Received $203 million in cash consideration
- Retained 47% ownership in Great American Group through Class A Common Units
- Expected gain of $235 million in Q4 2024
- Significant debt reduction opportunity
- Maintains upside potential through equity stake
- Reduction in direct control over Great American Group operations
- Decreased ownership from 100% to 47% in the business unit
Insights
This strategic partnership marks a significant financial restructuring for B. Riley, with immediate and long-term implications. The
Retaining
The Great American Group to Leverage 30-Year Track Record to Provide Industry-Leading Valuation, Appraisal, Asset Disposition and Real Estate Services
B. Riley to Recognize Gain of Approximately
The launch of the GA Group as an independent business follows the completion of the transactions between B. Riley and Oaktree previously announced on October 14, 2024. Prior to the closing, B. Riley undertook a pre-closing internal reorganization resulting in the contribution of all of the interests in B. Riley's Appraisal and Valuation Services, Retail, Wholesale & Industrial Solutions and Real Estate businesses into Great American Holdings, LLC, a newly formed holding company ("Great American NewCo"). At the closing, B. Riley received total consideration consisting of approximately
B. Riley expects to record a gain on its investment in GA Group of approximately
Bryant Riley, Chairman and Co-Chief Executive Officer of B. Riley, said, "We are excited about this new partnership with Oaktree, which has the scale and expertise in alternative investments to power GA Group's next chapter of growth and success. The transaction provided B. Riley with the ability to meaningfully de-lever our balance sheet and retain significant equity upside in a business with compelling growth prospects."
For more information on the GA Group, please visit www.brileyfin.com/ga-transition.
Advisors
Moelis & Company LLC served as the exclusive financial advisor to B. Riley, and Sullivan & Cromwell LLP served as legal advisor to B. Riley. Wachtell, Lipton, Rosen & Katz served as legal advisor to Oaktree.
About B. Riley Financial
B. Riley Financial is a diversified financial services company that delivers tailored solutions to meet the strategic, operational, and capital needs of its clients and partners. B. Riley leverages cross-platform expertise to provide clients with full service, collaborative solutions at every stage of the business life cycle. Through its affiliated subsidiaries, B. Riley provides end-to-end financial services across investment banking, 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. B. Riley opportunistically invests to benefit its shareholders, and certain affiliates originate and underwrite senior secured loans for asset-rich companies. B. Riley refers to B. Riley Financial, Inc. and/or one or more of its subsidiaries or affiliates. For more information, please visit www.brileyfin.com.
About Oaktree
Oaktree is a leader among global investment managers specializing in alternative investments, with
Forward-Looking Statements
Statements made in this press release that are not descriptions of historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and 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 today's date. All statements other than statements of historical fact are forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the Company's performance or achievements to be materially different from any expected future results, performance, or achievements. Forward-looking statements speak only as of the date they are made and the Company assumes no duty to update forward-looking statements, except as required by law. Actual future results, performance or achievements may differ materially from historical results or those anticipated depending on a variety of factors, some of which are beyond the control of the Company, including, but not limited to, the risks described from time to time in the Company's periodic filings with the SEC, including, without limitation, the risks described in the Company's 2023 Annual Report on Form 10-K and in B. Riley Financial's Quarterly Report on Form 10-Q for the period ended March 31, 2024 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 the Company undertakes no duty to update this information.
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SOURCE B. Riley Financial
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