B. Riley Financial Inc. is grappling with significant financial challenges following a troubled investment in Franchise Group, Inc. According to InvestmentNews, the firm reported a staggering $330 million markdown linked to its investment in the franchise business. Franchise Group, known for brands like Pet Supplies Plus and The Vitamin Shoppe, has struggled, leading to a sharp decline in B. Riley's stock price.

Amid this turmoil, Bryant Riley, the firm's chairman and co-CEO, has offered $7 per share to take B. Riley Financial private. This bid, valued at approximately $210 million, has shocked shareholders who saw the stock trading at $52 per share just a year ago.

InvestmentNews reports that the Securities and Exchange Commission (SEC) is investigating whether B. Riley Financial provided accurate information to investors regarding the Franchise Group deal. This scrutiny adds further pressure on the firm, which must act swiftly to stabilize its operations.

B. Riley Financial went public in 2014 at $5 per share and has since returned over $20 to shareholders through dividends and share buybacks. Despite these returns, the current situation presents significant challenges for the firm as it navigates the fallout from its investment in Franchise Group and the potential impact of the ongoing SEC investigation.

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