B. Riley Financial Announces Strategic Wealth Management Sale
Enters into Agreement with Stifel Financial Corp.
B. Riley Financial, Inc. (NASDAQ: RILY), a company known for its diversified financial services, has exciting updates to share regarding its Wealth Management business. Recently, the company signed a definitive agreement to divest a portion of its traditional Wealth Management operations to Stifel Financial Corp. (NYSE: SF). This strategic move is anticipated to yield a net consideration ranging from $27 million to $35 million in cash. Notably, this transaction will not affect approximately 190 independent advisors and 90 tax professionals affiliated with B. Riley.
The transaction marks a pivotal moment as the company prepares for the transition of around 40 to 50 advisors and their associated customer accounts, expected to occur in early 2025. These accounts constitute a significant total of assets under management (AUM), projected to be between $3.5 billion and $4.5 billion as of the end of September.
Insights from Leadership
Bryant Riley, the Chairman and Co-CEO of B. Riley Financial, provided valuable insights into this transition: "The past year has served as a period of disruption for our Wealth Management brand. Various competitors capitalized on uncertainties stemming from our principal investments business. In response, we chose to pursue a proactive approach for those advisors seeking new beginnings. Partnering with Stifel, a well-respected entity in the industry, was an ideal choice. Our transition plan assures that these advisors can transfer their accounts smoothly, maintaining continuity without affecting daily operations."
Mr. Riley emphasized the importance of maintaining a strong presence in the Wealth Management sector, stating, "Even as we refocus B. Riley towards our core middle-market financial services, we recognize the significant advantages of keeping Wealth Management as an element of our overall portfolio. Our commitment remains firm in investing and enhancing our primary financial service offerings, and we are fully equipped to meet the needs of clients in the small- and mid-cap markets."
Transaction Details and Future Outlook
The transaction has gained approval from the Board of Directors and awaits necessary regulatory approvals along with other customary closing conditions. The successful conclusion of the deal is projected for early in the second quarter of 2025, marking the next chapter for both B. Riley and Stifel.
About B. Riley Financial
B. Riley Financial stands as a beacon of diversified financial solutions, delivering customized services tailored to meet the strategic, operational, and capital needs of its clientele. Renowned for leveraging its broad expertise, the company provides an array of collaborative financial solutions that span various stages of the business lifecycle.
The firm's capabilities include investment banking, institutional brokerage, private wealth and investment management, financial consulting, and many other financial services. B. Riley aims to optimize returns for shareholders and is involved in originating and underwriting senior secured loans to asset-rich entities.
Frequently Asked Questions
What did B. Riley Financial announce recently?
B. Riley Financial announced it signed an agreement to sell a portion of its Wealth Management business to Stifel Financial Corp. for an estimated net consideration of $27 million to $35 million in cash.
Will independent advisors be affected by the sale?
No, the transaction does not include approximately 190 independent advisors and 90 tax professionals associated with B. Riley.
When is the transaction expected to be completed?
The transaction is expected to close early in the second quarter of 2025, pending regulatory approvals.
What are the total assets under management involved in this deal?
The accounts transitioning to Stifel represent estimated total assets under management of between $3.5 billion and $4.5 billion.
Who is Bryant Riley?
Bryant Riley is the Chairman and Co-CEO of B. Riley Financial, and he provided insights on the strategic direction of the company and the recent sale.
