Investing.com -- B. Riley Financial Inc (NASDAQ:RILY). has paused the payment of dividends on two of its preferred stock offerings. The suspension affects the firm's 6.875% Series A and 7.375% Series B preferred stocks, as stated in a recent Monday announcement. The dividends that remain unpaid will keep accumulating until they are fully paid.
While the firm holds off on these payments, it is also preparing to pay off another set of notes. The company's 6.375% notes, which are due on Feb. 28, are expected to be redeemed on schedule.
Bryant Riley, the Chairman of B. Riley Financial, has focused on reducing the company's debt. This comes as the firm aims to recover from a series of losses and writedowns on investments that did not perform as expected. The most significant of these was the November bankruptcy of Franchise Group (NASDAQ:FRG), a collection of retail brands that was one of B. Riley's largest holdings. A bankruptcy judge has stated that the equity of Franchise Group appears to be worthless.
A representative for B. Riley clarified that the suspension of the preferred dividend was not a move to conserve cash. However, the representative did not provide further details on the reasons behind the decision. Following this news, the common shares of B. Riley experienced a decline. They fell around 2.5% to $4.88 at midday in New York, after dropping as much as 7.4%. These shares had previously reached a high of over $40 in April 2024.
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