B. Riley Securities to merge with Cascadia in carve out

B. Riley Financial (RILY) earlier today announced that a formerly wholly-owned subsidiary of the company has merged with Cascadia Investments (CDIV), a shell entity, as a result of which certain investors in Cascadia became minority stockholders of B. Riley’s investment banking subsidiary, B. Riley Securities (BRLY). As part of the tax-free transaction, B. Riley Securities is implementing its own operating and governance structure, and its common stock will now be quoted on the OTC Pink market under the ticker symbol “BRLY,” the company said in a statement. BRS will independently report financial results. B. Riley added, “The transaction has been structured as a tax-free separation with minimal costs. After giving effect to the transaction, BRF owns approximately 89% of the outstanding shares of BRS, with the remaining shares exclusively held by the employees of BRS in the form of restricted stock awards and certain of the existing shareholders of Cascadia.” Shares of B. Riley Financial are down 4% to $4.30 in afternoon trading.