JMP Group Announces Sale of Majority Interest in JMP Credit Advisors
March 20 2019 - 6:45AM
Business Wire
JMP Group LLC (NYSE: JMP), an investment banking and alternative
asset management firm, announced today that it has sold a 50.1%
equity interest in JMP Credit Advisors LLC (“JMPCA”) to Medalist
Partners LP, an alternative asset management firm specializing in
structured credit and asset-backed lending, and a 4.9% interest to
management employees of JMPCA. A wholly-owned subsidiary of JMP
Group will retain a 45.0% interest in JMPCA.
As a result of the transaction, JMPCA has been renamed Medalist
Partners Corporate Finance LLC. Based outside of Atlanta, Medalist
Partners Corporate Finance is a registered investment advisor under
the Investment Advisers Act of 1940 and is an asset manager that
invests in senior secured debt through collateralized loan
obligations, or CLOs. As of December 31, 2018, it managed three
CLOs with combined assets of $1.2 billion.
“We are enthusiastic about the opportunity to work with Medalist
Partners,” said JMP Group Chairman and Chief Executive Officer Joe
Jolson. “This transaction achieves two important objectives for JMP
Group. First, we have attracted significant third-party capital to
our successful corporate credit business, reducing JMP Credit
Advisors’ reliance on JMP Group for capital and leaving us with a
significant investment in a highly scalable asset management
platform with the prospect of rapid AUM growth. Second, we have
delivered on our promise to shareholders to meaningfully simplify
our corporate structure. We expect that the sale of a majority
interest in JMP Credit Advisors will enable us to deconsolidate our
CLOs from our financial statements, potentially smoothing our
operating earnings from quarter to quarter due to the absence of
irregular credit costs and shrinking our year-end balance sheet
from $1.4 billion, with $1.2 billion of debt, to just over
$230 million, with approximately $84 million of long-term debt
and approximately $86 million of tangible equity.”
In connection with the sale, Medalist Partners has committed to
provide additional capital to fund a preexisting long-term
warehouse credit facility with BNP Paribas that will continue to be
used to finance the acquisition of a portfolio of broadly
syndicated corporate loans. Medalist Partners Corporate Finance,
previously JMPCA, acts as collateral manager for the loans acquired
through the warehouse credit facility, which was announced by JMP
Group in a Form 8-K filed on October 12, 2018.
JMP Securities LLC acted as exclusive financial advisor to JMP
Group in connection with the transaction, and Dechert LLP served as
legal advisor.
Cautionary Note Regarding Forward-Looking Statements
This press release may contain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”). Forward-looking statements provide
JMP Group’s current expectations or forecasts about future events,
including beliefs, plans, objectives, intentions, assumptions and
other statements that are not historical facts. Forward-looking
statements are subject to known and unknown risks and uncertainties
that could cause actual results to differ materially from those
expected or implied by the forward-looking statements. The
company’s actual results could differ materially from those
anticipated in forward-looking statements for many reasons,
including the factors described in the sections entitled “Risk
Factors” and “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” in the company’s Form 10-K for
the year ended December 31, 2017, as filed with the U.S. Securities
and Exchange Commission on March 28, 2018, as well as in the
similarly captioned sections of other periodic reports filed by the
company under the Exchange Act. The Form 10-K for the year ended
December 31, 2017, and all other periodic reports are available on
JMP Group’s website at www.jmpg.com and on the SEC’s website at
www.sec.gov. Unless required by law, JMP Group undertakes no
obligation to publicly update or revise any forward-looking
statement to reflect circumstances or events after the date of this
press release.
About JMP Group
JMP Group LLC is a diversified capital markets firm that
provides investment banking, equity research, and sales and trading
services to corporate and institutional clients as well as
alternative asset management products and services to institutional
and high-net-worth investors. JMP Group conducts its investment
banking and research, sales and trading activities through JMP
Securities; its hedge fund, venture and private capital, and credit
management activities through Harvest Capital Strategies and JMP
Asset Management; and the management of Harvest Capital Credit
Corporation (NASDAQ: HCAP), a business development company, through
HCAP Advisors. For more information, visit www.jmpg.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20190320005158/en/
Investor Relations ContactJMP Group LLCAndrew Palmer(415)
835-8978apalmer@jmpg.com
Media Relations ContactsDukas Linden Public Relations,
Inc.Zach Leibowitz(646) 722-6528zach@dlpr.com
Alyssa Noud(646) 722-6525alyssa@dlpr.com
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