(Bloomberg) — B. Riley Financial Inc . agreed to sell part of its wealth management business to Stifel Financial Corp. for more than $35 million in cash, the latest in a series of asset sales aimed at trimming the investment firm's cash-strapped debt load.
The transaction does not include B. Riley's approximately 190 independent advisors or 90 tax professionals, the company said in a statement Friday. The final price will be based on the number of advisers making the move, with about 50 of them – along with their associated client accounts – expected to join Stifel early next year.
The account moves represent total assets under management of about $3.5 billion to $4.5 billion as of Sept. 30.
B. Riley's shares have fallen in recent years as its investments soured and US authorities investigated some of its business dealings and disclosures. The Los Angeles-based firm also missed a deadline to file its second-quarter financial statements, which are still pending. Chief Executive Bryant Riley and his company have said there was no wrongdoing and they are cooperating with authorities.
“The past year has been disruptive for our wealth management business, with competitors taking advantage of the hype surrounding our core investment business,” Bryant Riley said in the statement. “We decided to take a proactive approach for those who wanted a fresh start and found a respected partner in Stifel.”
The company's shares advanced 0.8% in early New York trading. They were down 72% this year through Thursday.
Last month, B. Riley made two deals to raise money, including removal of rights in its durable consumer brands for $236 million. The company also agreed to sell one most of the shares in its large US business to funds managed by Oaktree Capital Management LP.
Asset sales could help B. Riley shore up its balance sheet as it grapples with a debt load that stood at about $2 billion at midyear. The company suspended its dividend in August to prioritize deleveraging and recently renegotiated its senior loan with terms that included paying off the balance sheet and terminating a revolving line of credit.