Profile: Rodman & Renshaw Capital Group, Inc. (RODM.O)

Rodman & Renshaw Capital Group, Inc. (RRCG) is a holding company that through its various subsidiaries is engaged in the investment banking business. RRCG’s principal operating subsidiary is Rodman & Renshaw, LLC (R&R). R&R is a broker dealer registered with the Financial Industry Regulatory Authority, Inc. (FINRA). The Company is a full service investment bank providing corporate finance, strategic advisory and related services to companies. It also provides research, and sales and trading services to institutional investors. RRCG’s business consists of investment banking, which includes corporate finance and strategic advisory services; sales and trading; equity research, and principal transactions. In October 2009, Rodman & Renshaw Capital Group Inc. announced that its affiliate, Aceras BioMedical LLC, has sold Huxley Pharmaceuticals Inc. to BioMarin Pharmaceutical, Inc.

In March 2008, RRCG acquired Miller Mathis & Co, LLC (Miller Mathis), which is a mergers and acquisitions advisor to the global steel industry. In May 2008, it formed Aceras BioMedical LLC (Aceras BioMedical), which is a joint venture with an established team of biotech research and investment specialists (Aceras Partners, LLC), to make principal investments in promising products and early-stage companies in the biotechnology and life science sectors. In June 2008, it acquired COSCO Capital Management LLC (COSCO), a private investment bank focused on the energy sector.

Investment Banking

The investment banking segment focuses on providing corporate finance and strategic advisory services to public and private companies. The Company offers its clients a range of financing alternatives, including private placements, private investment in public equity (PIPE), registered direct offerings (RD) and underwritten public offerings. In PIPE transactions, a publicly-traded reporting company sells unregistered securities of a class, and/or convertible or exchangeable for a class, that is already publicly traded. Generally, the issuer is obligated to register the securities within a specified period after the transaction closes.

RD transactions are direct placements of securities that have been registered under a shelf registration statement and, therefore, are immediately tradable. Private placement transactions involve sales of unregistered securities. In most cases the issuer is a private company, although public companies can undertake private placements as well. The securities sold may be common or preferred equity, debt, convertible debt, or derivatives, such as warrants. The debt could be secured or unsecured, senior, mezzanine or subordinated. Many of these transactions involve units, which include more than one class of securities. Public offerings involve securities that have been registered and that are listed or traded on an exchange. The offering may constitute an initial public offering by a private company or a follow-on offering by an existing public company. RRCG also provide strategic advisory services on a range of transactions, including mergers, acquisitions and asset sales. It is involved at each stage of these transactions, from initial structuring to final execution.

Sales and Trading

As of December 31, 2008, the Company’s sales and trading unit included seven sales people, four sales traders and two traders. They focus on executing trades for institutional investor clients in the United States and Europe. As of December 31, 2008, the Company was a market-maker for 249 stocks.

Research

As of December 31, 2008, the Company’s research department included 10 senior analysts: six who cover the life science sector; one who covers the metals/mining sector; one who covers the energy sector, and two who cover other sectors. These senior analysts are supported by 12 associate analysts. As of December 31, 2008, the research department covered 139 companies.

Principal Transactions

The Company’s merchant banking efforts primarily comprises making limited principal investments in several PIPE and RD financing transactions where it also acts as the placement agent, and obtaining equity ownership stakes in publicly-traded shell companies. The shell companies are reporting companies that have no active trade or business and nominal assets that were subsequently merged with operating private companies through reverse mergers or collateralized acquisition pools (CAPs) arranged by the Company.

The Company competes with Canaccord Adams, Inc., Cowen Group, Inc, Jefferies Group, Inc., JMP Group, Inc, Ladenburg Thalmann Financial Services, Inc., Lazard Ltd., Leerink Swann & Co., Merriman Curhan Ford Group, Inc., Oppenheimer & Co. Inc., Piper Jaffray Companies., Roth Capital Partners, LLC and Thomas Weisel Partners Group, Inc.