On a conference call with advisors Tuesday, Robert Moore, chief executive of Cetera Financial Group, gave no hint about where the firm’s strategic review might lead.
Moore addressed the troops in the wake of news reports that the firm had retained Goldman Sachs for what Cetera calls a “capital structure review.”
Those reports ignited speculation that the firm could be sold.
In a heartfelt talk during which he did not take questions, Moore said he had requested the review “with the express intention of lowering our current capital costs and maximizing our ability to continue to invest and drive our business.”
Cetera has a “very diverse shareholder base as a byproduct of the [2016 bankruptcy] restructuring,” he said. “And I’ve made it clear that those shareholders have been phenomenally supportive of us. … Equity holders of course have their own set of objectives … having been original debt holders and we want to be supportive of them.”
Moore did not elaborate on what the shareholders wanted, but he insisted Cetera’s management and advisors will have a say in any final actions. What Cetera stockholders really want is a question that may be unanswerable at this point, given that Cetera has many small shareholders.
None have a controlling interest and, as Moore indicated, that gives management some degree of influence. Furthermore, it was the previous ownership, Nick Schorsch's Reality Capital, that placed excessive leverage on Cetera ultimately leading to it bankruptcy. So the former debtholders who are current equity-holders are aware that today's management team played no role in the 2016 default.
“This management team -- I am the largest individual shareholder -- [will] have a very powerful and strong voice in the thought process and in the range of options we will be considering, and in the decisions we take,” Moore said.
A select number of advisors will also be allowed to participate, he added, in order to “understand what it is we are doing, what sort of options we are considering, and giving us feedback along the way.”
The review should be completed within a few months, he said.