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Great American Group Closes $51.4 Million Private Placement

June 06, 2014, 07:13 AM
Filed Under: Industry News

Great American Group, Inc., a leading provider of asset disposition and financial advisory services, announced the closing of its previously announced $51.4 million private placement offering through the sale of approximately 10.3 million shares of common stock.

Great American Group has also announced that it has completed the previously announced repayment of indebtedness owed to Great American Group founders, Andrew Gumaer and Harvey Yellen. Approximately $48.8 million in principal of outstanding promissory notes due to Gumaer and Yellen was retired in full for an aggregate payment of approximately $30 million plus accrued interest. The repayment satisfies the outstanding principal and accrued interest obligations due to the Great American Group founders under such notes, and represents a 38 percent discount to the face amount of principal owed on the debt.

The previously announced combination with B. Riley & Co., LLC, a leading, full-service independent investment bank, is anticipated to close later this month. The stock-for-stock transaction will create a uniquely positioned investment banking and financial services firm with over 250 employees and a geographic footprint extending across the United States and Europe. The terms of the combination provide for the issuance of an estimated aggregate of 4.2 million shares of Great American Group common stock (subject to working capital adjustments) in exchange for 100 percent of the ownership interests of B. Riley. Upon consummation of the transaction, Mr. Bryant Riley will assume the role of Chairman of the Board and Chief Executive Officer of the combined company.

Earlier in the week, Great American Group announced a 1-for-20 reverse stock split which took effect June 3, 2014. The reverse stock split reduced the number of common shares outstanding at such time from approximately 30 million shares to approximately 1.5 million shares. Including the shares issued in the private placement, Great American Group currently has approximately 11.8 million shares outstanding. Great American Group's common stock will continue to trade on the OTCBB. For the first 20 business days post-reverse split, the stock will trade under the symbol "GAMRD" before reverting back to ticker symbol "GAMR."

Great American Group is a leading provider of asset disposition and auction solutions, advisory and valuation services, capital investment, and real estate advisory services for an extensive array of companies.







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