Liquidation Plan Shelved by Brokerage
Less than a week after announcing plans to close the firm and liquidate, McKewon & Timmins investment brokerage said Monday it will survive after all in a slightly altered corporate form, thanks to its planned acquisition by First Affiliated Securities, the brokerage chain acquired last week by A.J. Bekhor & Co. of London.
Terms of the pending acquisition were not announced. The firm merging with FAS will be called McKewon Capital Markets Inc., a successor firm to McKewon & Timmins. M&T; co-founder James Timmins will not stay on under FAS ownership and is considering “several attractive opportunities” outside the firm, his former partner, Ray McKewon, said at a Monday press conference.
M&T; announced it was closing shop last week after net capital fell below minimum levels required by the National Assn. of Securities Dealers. The announcement seemingly was the final curtain in the two-year M&T; drama, which was notable for a co-underwriting of one initial public stock offering, huge losses and complaints by embittered ex-employees that M&T; owed them back pay.
Last year, M&T; lost about $760,000 on $1.2 million in revenues.
Bekhor Chairman Jonathan E. Bekhor, who attended the Monday press conference, would not say how much capital he will invest in McKewon Capital, saying only that he expects the firm to be profitable this year. Most of M&T;’s 13 brokers are expected to stay with the new company, McKewon said, and FAS will take over M&T;’s 10,000-square-foot lease in the Imperial Bank Tower at 701 B St.
Also unclear is the fate of the 65 M&T; shareholders who invested $2.5 million in the failed investment brokerage. Without being specific, McKewon said FAS will make some sort of restitution to M&T; shareholders.
“They’ll get something. That’s more than they were going to get last week,” McKewon said.
Claims by two ex-employees at M&T; for more than $60,000 in back pay will soon go to arbitration, McKewon said. Former M&T; executive Robert Marlow is also reportedly seeking a settlement with the company.
FAS’s new parent firm, A.J. Bekhor, is the largest retail securities brokerage in the United Kingdom on the basis of securities trades made daily, Bekhor said. Bekhor paid $4.25 million for First Affiliated, which has 600 brokers in 203 offices nationwide.
