PLEASE DO NOT TAKE THIS WRITING AS A NEGATIVE–BUT INSTEAD SOMETHING TO PONDER–AND FOR THOSE WITH THE TIME TO DO SOME FORENSIC RESEARCH MAYBE THEY WILL FIND SOME INTERESTING DATA. MAYBE ALL IS FINE–BUT I ‘SMELL A RAT’ SOMEWHERE IN HERE.
B. Riley Financial (RILY) has been taking down quite a lot of debt and most recently sold 2 million shares of preferred stock. As I look on their last 10Q I see a line entry for $250 million in “loans receivable” listed in their assets–up from $38 million a year ago. I am not certain what this is all about.
We know that B Riley has bought some strange businesses over the last number of years such as magicJack which has proven to be successful–at least that is what has been reported.
But really B Riley caught my eye when they floated theMaven (MVEN) a $68 million loan back in June. For those not familiar with theMaven it is an internet platform where writers publish their articles etc. Brad Thomas originally claimed he was moving his ’empire’ to theMaven and even did a video of himself interviewing Jim Heckman–the founder of theMaven. I had contact with Brad and explained what to expect if he went that route. Of course Brad ignored me and started at theMaven–then after a few months he found out exactly what I had conveyed to him and he left them.
Has Bryant Riley been caught up in the glitz and glamour of Jim Heckman? The slick talking of Ross Levinson?
I watch Jim Heckman because my wife worked at one of his previous companies which went belly up. I have a decent idea of how this guy operates.
So since I am always squeezed for time I invite others to do a little research for all of us.
This is not about theMaven this is about how many millions in loans is B Riley making to theMaven. Given that B Riley has only $250 million in equity will a $50 or $100 million write down on loans cause a little consternation?
Here are some starting points.
Click here to google Jim Heckman and Ross Levinson. This will give you days and days worth of entertaining reading.
theMaven SEC filings provide lots of insight into what they are up to–they have recently purchased theStreet (Jim Cramers company) and licensed Sports Illustrated–all on borrowed money. Mind you that theMaven has not made a quarterly SEC 10Q filing for 1 1/2 years.
Thats all one needs to do some decent research. THIS IS NOT A WARNING—this is just a ‘I smell a rat’–and for folks holding B Riley baby bonds and preferred you may want to do some reading.