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B. Riley Financial Establishes New Receivables Division Providing Debt Monetization, Portfolio Acquisition Solutions

December 22, 2021, 08:00 AM
Filed Under: Industry News

B. Riley Financial has established a new receivables business to provide debt monetization solutions and portfolio acquisition services for its clients. This new division utilizes the Company's strong capital base and expert resources offered through its affiliates to preserve and maximize value for clients – including valuation services, restructuring and turnaround management, distressed debt and financial structuring. As of September 30, 2021, B. Riley Financial had in excess of $5 billion in total assets.

In connection with the formation of this new division, B. Riley Financial also announced it has purchased a portfolio of performing credit receivables from W.S. Badcock Corporation ("Badcock"), a leading home furnishings company and subsidiary of Franchise Group, Inc. Under the terms of the transaction, a B. Riley Financial entity has acquired the Badcock credit receivables portfolio for an aggregate purchase price of approximately $400 million. Badcock will continue to service and administer the purchased receivables, which totaled approximately $535 million as of December 15, 2021. The Company intends to purchase additional receivables, subject to certain limitations and restrictions.

Bryant Riley, Chairman and Co-Chief Executive Officer of B. Riley Financial, said: "We expect this purchase to be accretive to our EBITDA and to provide additional cash-flow for B. Riley Financial throughout the portfolio's lifecycle. This transaction is also a continuation of our commitment to enable FRG's success as a leading operator in the franchising sector. Utilizing our balance sheet to support our clients has been a proven driver of our ability to deliver for our shareholders. We intend to continue to pursue acquisitions and strategic investments with attractive risk-adjusted returns as a core part of our platform strategy."

Several B. Riley Financial affiliates provided financial advisory services to support an expedited and efficient closing of the Badcock receivables transaction. Choate Hall & Stewart LLP served as legal counsel and Hudson Cook, LLP served as regulatory counsel to B. Riley Financial. Willkie Farr & Gallagher LLP served as legal counsel to Franchise Group.

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