Gleacher to Liquidate After Failing to Find Buyer
Gleacher & Co. (GLCH) said it will liquidate, marking the end of a four-year decline that started when banker Eric Gleacher sold his merger-advisory firm to a bond brokerage.
Shareholders are expected to receive $9.70 to $14.55 a share over the next few years, or as much as $90 million, the New York-based company said today in a statement. The board decided to liquidate its assets after attempts to find a merger partner or sell the defunct brokerage failed, Chairman Mark Patterson, the private-equity executive who ousted Gleacher’s former chief executive officer, Thomas Hughes, said in the statement.
Gleacher, once valued at more than $1 billion, has posted more than $200 million in losses since 2009 while struggling to find a working strategy in bond trading and investment banking. After takeover talks with firms including Stifel Financial Corp. failed in 2012, Patterson, Hughes and Eric Gleacher couldn’t agree on a plan. Gleacher, 73, left in January 2013.
“It is in the best interests of the stockholders to dissolve and liquidate the company,” Patterson said in the statement. “The process to date has not yielded any opportunities viewed by the board as reasonably likely to provide greater realizable value.”
MatlinPatterson Global Advisers LLC, a New York-based private-equity firm co-founded by Patterson, took over Gleacher’s board in May and fired Hughes. New York-based Gleacher said in April it would shutter the fixed-income business that generated most of its revenue as salespeople defected and customers suspended trading.
If shareholders approve the liquidation, the initial distribution is expected to be about $20 million, or $3.23 a share, with subsequent distributions of $40 million to $70 million, according to the statement.
Gleacher also said today it posted a loss of $2.9 million, or 47 cents a share, for the fourth quarter of 2013. The stock gained 3 percent to close at $11.65 in New York.
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