— Kevin Lupowitz Recruited as CEO of DirectMarkets —
— Management to Hold Conference Call at 11:00AM (ET) Today —
NEW YORK--(BUSINESS WIRE)--Feb. 2, 2012--
Rodman & Renshaw Capital Group, Inc. (Nasdaq: RODM), via a
new subsidiary, DirectMarkets, will unveil an automated state-of-the-art
electronic transaction platform to directly link existing public company
issuers and investors seeking to transact primary offerings of
securities. DirectMarkets will bring unprecedented, cost-efficient
access to the capital markets into the C-Suite of public companies and
bypass certain traditional roles typically held by investment banks that
presently control the transactional process. Both investors and issuers
will benefit from 24/7 seamless access to DirectMarkets’ platform
through a graphical user interface (GUI) accessible via a desktop or
laptop computer, as well as any mobile smart devices such as tablets or
smartphones. The official launch will take place at the TradeTech
2012 Conference in New York City that begins on March 6, 2012.
With its many features, the DirectMarkets platform will empower issuers
to sell shares (covered by a shelf registration) directly into the
secondary market and to complete funding transactions at a fraction of
the current cost. Using the same platform, investors will be able to
directly contact issuers, with effective shelf registrations in place,
to indicate their interest in buying that issuer’s stock, effectively
gaining the ability to accumulate stock positions in a more
cost-effective manner than through on-going open market purchases.
Suitable for companies listed on NYSE, NYSE Amex and NASDAQ, as well as
unlisted OTCBB companies, the DirectMarkets platform is designed to
bring greater efficiency and cost savings to current methods that public
companies use to effect financings, including follow-on offerings,
Registered Directs (RDs,) At-the-Markets (ATMs), Confidentially Marketed
Public Offerings (CMPOs) and Private Investments in Public Equities
(PIPEs). Adaptation of the platform across international markets will
also be pursued by DirectMarkets.
To lead DirectMarkets, Rodman has recruited Kevin Lupowitz as Chief
Executive Officer of the DirectMarkets operating entity. Before joining
DirectMarkets, Mr. Lupowitz, age 42, was the Chief Information Officer
at FXall, a leading electronic foreign exchange platform. Previously, he
was a founding employee of Liquidnet, the global institutional trading
network, where he was also Chief Information Officer.
By providing added efficiencies that link issuers with purchasers of
securities, while substantially reducing related fees and expenses
because of the limited role of intermediaries, the DirectMarkets
platform is positioned to be the catalyst for a major paradigm shift in
the securities industry. As Edward Rubin, Chief Executive Officer of
Rodman & Renshaw, explained: “DirectMarkets is an outgrowth of Rodman’s
continual evolution and desire to lead, innovate and service the capital
needs of both issuers and investors. We have always recognized the need
to be swift in adapting to changes in financing approaches and
marketplace requirements. DirectMarkets will be a game-changer and with
Kevin Lupowitz’s talent and experience at the helm, this new electronic
transaction platform is the catalyst that will redefine Rodman as an
innovative technology company focusing on the financial services
industry, while strengthening our legacy business.”
The DirectMarkets platform will complement Rodman’s various other
business activities, including its market making, sales & trading,
research, investment banking, and conferences. In assessing the multiple
advantages, Mr. Lupowitz added, “I look forward to heading
DirectMarkets. Rodman already has a solid foundation of thousands of
potential issuers and investors. DirectMarkets will capitalize on those
existing relationships to provide issuers with efficient access to
market demands. We will have a unique competitive advantage as the
platform gains traction and we begin the process of easing issuers and
investors through the transition from manual transactions to our new
In conjunction with the launch of DirectMarkets, Rodman & Renshaw
Capital Group, Inc. intends to change its name to Direct Markets
Holdings Corp., subject to stockholder approval at its 2012 Annual
Meeting of Stockholders scheduled to be held on May 4, 2012. Rodman’s
sales & trading and investment banking operations will continue to be
conducted by Rodman & Renshaw, LLC.
DirectMarkets Key Features
The DirectMarkets platform’s functionality will include:
24/7 seamless access to the DirectMarkets portal through a graphical
user interface (GUI) utilizing a desktop or laptop computer, or any
mobile smart device such as a tablet or smartphone. Providing
Execution Management System (EMS) and Order Management System (OMS)
integration for primary offering transactions.
Connectivity among public companies, institutional investors and
sell-side firms to facilitate the purchase and sale of securities,
typically off an issuer’s existing shelf registration. Matching
secondary market demand (i.e., investor demand typically fulfilled
through transactions effected on exchanges or alternative trading
systems) with a new source of supply: primary offerings of securities
by existing publicly traded companies (i.e., direct purchases from
issuers) utilizing reverse inquiry processes. Enabling investors to
express interest directly to an issuer in its securities, becoming a
catalyst for a potential transaction.
Workflow management tools for complex financing transactions beyond
the standardized offerings of common stock at an agreed-upon price.
Automating and standardizing the closing process for capital markets
transactions from engagement letter through document negotiation,
allocation and settlement resulting in significantly reduced costs and
transaction expenses for the issuer.
Seamless management of ATMs by issuers through the DirectMarkets
portal, efficiently selling securities directly into trading markets,
reducing costs and taking advantage of market trends and opportunities.
Ability for issuers to seamlessly manage and monitor open-market
buy-back programs through the DirectMarkets portal.
Connectivity among holders of large blocks of an issuer’s securities
and interested purchasers, enabling such purchasers to identify and
contact such holders directly, and providing venture capital firms,
private equity firms, chief executive officers and other senior
executives with additional opportunities to monetize their holdings.
Enabling executives to sell 144 restricted and control securities into
a trading market in compliance with holding period, volume restriction
and manner of sale regulations.
Providing an issuer-managed social networking platform where issuers
can communicate directly with investors on a targeted or
non-discretionary basis through interactive (e.g., blogs, twitters,
virtual tours, etc.) and static content (e.g., press releases,
regulatory filings, etc.), and providing investors with a centralized
destination to access information across their target companies.
Providing issuers with the functionality to conduct electronic
non-deal road shows with qualified investors.
The DirectMarkets platform was developed by Rodman over the last several
years, building on the expertise that it has obtained in completing more
than 580 financing transactions for public companies since 2002. During
the last decade, capital-raising options and alternatives for public
companies have evolved from traditional follow-on offerings to RDs, ATMs
and CMPOs. Through this evolution, the issuer has gained more influence
over the capital-raising process by acting on shorter notice and
reducing its exposure to market volatility during the life of a deal.
The DirectMarkets platform is the next and logical evolutionary step in
empowering the issuer and bringing access to the capital markets
directly into the C-Suite of public companies through an electronic
interface linking public company issuers with investors.
Patents have been filed and are being prosecuted in the United States
and abroad with respect to proprietary components of the DirectMarkets
platform including its trade matching system, interfaces and processes.
In recent years, disintermediation has fueled cost savings, introduced
efficiencies, and sparked new business models both within the financial
services community and across many other industries. Secondary trading
of securities has been revolutionized through automation and technology
applications resulting in significantly reduced costs, execution
efficiency and disintermediation with market participants gaining direct
access to counterparties. Companies such as Instinet, ITG and Liquidnet
led the way with industry-changing applications and platforms. However,
this disintermediation, and the resultant efficiencies, have largely
bypassed the market for primary offerings of securities by existing
publicly traded companies, where transactions are still predominantly
handled manually, much as secondary trading transactions were in years
past. DirectMarkets aims to bring the market for primary offerings of
securities by existing publicly traded companies into the 21st
century with automation, connectivity and disintermediation, resulting
in increased efficiencies and significantly reduced costs.
DirectMarkets’ targeted market is currently suited for transformation.
The market is large and highly fragmented. While Rodman is the leader in
the PIPE and RD transaction markets, having been ranked the #1 Placement
Agent in terms of the aggregate number of PIPE and RD financing
transactions completed every year since 20051, our market
share still only amounts to approximately 8.3% of transactions completed
and represents only 4.6% of gross dollars raised through these
offerings. The total PIPE and RD marketplace for U.S. public companies
was approximately $27.8 billion in 2011. The complete market for primary
offerings of securities by existing publicly traded companies includes
PIPE, RD, CMPO, Follow-On and ATM transactions. Capital raised in this
market totaled approximately $163 billion in 2011. Every U.S. public
company that has in place or is eligible to file a shelf registration
statement is a potential user of the DirectMarkets platform. Over the
past five years, over 4,000 shelf registration statements have been
filed by U.S. public companies.
Given the size of the market for primary offerings of securities by
existing publicly traded companies and its fragmented state, Rodman is
convinced that directly connecting issuers and investors through a
low-cost, efficient and proprietary automated platform presents
DirectMarkets with a very significant market opportunity.
Conference Call Information
In conjunction with this release, Rodman & Renshaw will hold a
conference call on February 2, 2012 at 11:00 AM Eastern Time, hosted by
Mr. Edward Rubin, Chief Executive Officer, Mr. Michael Vasinkevich, Vice
Chairman, Mr. David Horin, Chief Financial Officer and Mr. Kevin
Lupowitz, the Chief Executive Officer of our DirectMarkets subsidiary.
Investors and analysts can participate in the conference call by dialing
1-877-407-9205 (United States) or 1-201-689-8054 (International).
The conference will be replayed in its entirety beginning at
approximately 2:00 PM Eastern Time on February 2, 2012, through to 11:59
PM Eastern Time on February 8, 2012. To access the replay of this
conference call, please dial 1-877-660-6853 (United States) or
1-201-612-7415 (International) and use Account # 286, Conference #
The conference call will also be simultaneously broadcast live over the
Internet, as well as for replay, and can be accessed through the
webcasts and presentations tab of the investor relations section of the
Rodman & Renshaw Capital Group, Inc. website located at www.rodm.com.
Please allow for some time following the completion of the conference
call to access the archive of the Webcast. Allow for time prior to the
conference call Webcast to visit the web site and download the streaming
media software required to listen to the Internet broadcast.
About Rodman & Renshaw Capital Group, Inc.
Rodman & Renshaw Capital Group, Inc. (NASDAQ: RODM) is a holding company
with a number of direct and indirect subsidiaries, including Rodman &
Rodman & Renshaw, LLC is a full-service investment bank dedicated to
providing corporate finance, strategic advisory and related services to
public and private companies across multiple sectors and regions. The
company also provides research and sales and trading services to
institutional investors. Rodman is the leader in the PIPE (private
investment in public equity) and RD (registered direct offering)
transaction markets. According to Sagient Research Systems, Rodman has
been ranked the #1 Placement Agent by deal volume of PIPE and RD
financing transactions completed every year since 2005. For more
information visit Rodman & Renshaw on the Internet at www.rodm.com.
MEMBER FINRA, SIPC
Cautionary Note Regarding Forward Looking Statements
This press release contains forward-looking statements regarding future
events and financial performance including, but not limited to the
timing and success of the roll-out of the DirectMarkets platform. In
some cases, you can identify these statements by words such as “may,”
“might,” “will,” “should,” “except,” “plan,” “intend,” “anticipate,”
“believe,” “estimate,” “predict,” “potential,” or “continue,” the
negative of these terms and other comparable terminology. These
statements involve a number of risks and uncertainties and are based on
numerous assumptions involving judgments with respect to future
economic, competitive and market conditions and future business
decisions, all of which are difficult or impossible to predict
accurately and many of which are beyond the Company’s control. There are
or may be important factors that could cause our actual results to
materially differ from our historical results or from any future results
expressed or implied by such forward looking statements.
These factors include, but are not limited to, those discussed under the
section entitled “Risk Factors” in our Annual Report on Form 10-K, filed
March 15, 2011, which is available at the U.S. Securities and Exchange
Commission website at www.sec.gov.
The forward-looking statements in this press release are based upon
management's reasonable belief as of the date hereof. The Company
undertakes no obligation to revise or update publicly any
forward-looking statements for any reason.
1 Source: Sagient Research Systems, a leading publisher of
independent research for the financial services and institutional
Source: Rodman & Renshaw Capital Group, Inc.
Rodman & Renshaw Capital Group, Inc.
Chief Financial Officer
for Rodman & Renshaw and DirectMarkets