Peter Rosenthal, president of Rosenthal & Rosenthal, has had to do some deep thinking over the years.
“When I joined the company in 1998, it was a time of great transition for us,” he said. The passing of his grandfather Imre, who founded the company, had many executives at the family-owned and operated firm wondering about the company’s future.
The first order of business “was to bring in people from the outside, and then we started to do larger transactions, as well as transactions that were more complex,” he said.
One of those individuals who was brought into the family fold was J. Michael Stanley, who now heads up the factoring division at the company. Both Rosenthal and Stanley started the same year, and after 20 years of working together, a meeting with both present often has one finishing the other’s sentences.
Other long-time staffers include Michael Cipriani, executive vice president, a 30-year veteran of the firm in charge of new business development, and Gary Norman, executive vice president, Eastern Region manager, who has been with the firm for nearly a decade and has been instrumental in building Rosenthal’s portfolio base. Designer clients include Diane von Furstenberg, Rebecca Minkoff, Alexander Wang, Proenza Schouler and Carmen Marc Valvo. Another long-time client is Beverly Hills Polo Club.
For Rosenthal, who emphasized that every employee is part of the Rosenthal family, the bigger question has been how to take the factoring business to the next level. Answering that question would ensure the continuing legacy of the firm founded by his grandfather, as well as the employment of Rosenthal’s growing “office” family. Moreover, that continuity also would ensure Rosenthal’s position as one of the leading independent national finance firms in the country. According to Rosenthal, that independence, free from certain governmental regulations, has allowed the firm to make lending decisions that enable many small- and mid-size firms to stay in business.
There is no doubt in Rosenthal’s mind that factoring will always be the “lion’s share” of the firm’s revenues. Total factored volume is already at a robust $9 billion. Over the years, the firm added other services and options, such as asset-based lending and purchase order financing. It also has expanded from its headquarters in Manhattan to include a West Coast office in Los Angeles.
But the game changer occurred last month when Rosenthal & Rosenthal closed on its first acquisition in its 80-year history. The firm acquired the domestic factoring portfolio of BB&T Corp.
The transaction adds $2 billion in volume to its existing $9 billion through the addition of BB&T’s 90 factoring clients. Further, to handle the new business, Rosenthal plans to add a front office in the Atlanta area, as well as back-office support in Greenville, N.C. It also adds 25 BB&T factoring professionals to its nearly 200 staff members.
And while much of Rosenthal’s business has its roots in the apparel and textiles sectors, the finance firm is strong in the home and manufacturing sectors. The BB&T deal now allows Rosenthal to expand into areas and industries beyond those it serves, as well as grow within existing businesses.
Peter Austin, who joined Rosenthal in 2011 as a senior account executive, spearheaded the company’s efforts with its BB&T acquisition.
“Clients in the apparel [sector] have gone through a lot of change. It’s [gotten] very competitive, and clients have been forced to be more adept at how they source and finance [their business],” Rosenthal said.
The president noted that while the natural evolution of change has resulted in clients becoming more sophisticated in how they operate their firms, it also keeps him busy thinking about Rosenthal’s business and “finding ways to support them.”