There is a phrase many mature companies use to describe the mind-set of young, hasty entrepreneurs: they’re said to suffer from an Icarus complex, and, indeed, flying too high and growing too rapidly can be the death of some young stars. But for J. Don Rice, controlled expansion is sometimes a player’s best tactic. With a second huge addition to his New York-based Rice Financial Products Co. in as many years, Don Rice’s firm is taking off-again.
The New York-based company is spreading its wings with the recent acquisition of rival Pryor, McClendon, Counts & Co.’s municipal finance unit. The terms of the deal were not disclosed. PMC rose to 22nd among all investment banks in the underwriting of municipal bonds, with more than $9.7 billion in total volume as of November 1999, making it the nation’s ninth largest African American municipal finance firm.
Rice Financial, which gained a large share in the Southwest with last year’s purchase of Houston’s minority-owned brokerage Apex Securities (No. 4 on the be investment banks list), will now increase its Northeast presence with the addition of the PMC unit to its ranks. The combined operations of Apex and PMC, which will be called Apex Pryor Securities Inc., will be the 16th largest municipal finance investment bank in the nation, according to company estimates. Apex Pryor will be a division of Rice Financial.
“PMC has long been a leader in public finance investment and has maintained substantial New York clients,” says Rice. “To be able to have access to a number of prestigious clients in the New York area was very attractive to us. Our combined strengths will allow us to provide a greater level of service and greater distribution.”
By all accounts, PMC has been successful and gained a reputation in the Big Apple and the surrounding region where Rice Financial has traditionally not fared as well. PMC (No. 9 on the be investment banks list), founded in 1981, is the nation’s oldest black investment bank. It counts the Port Authority of New York & New Jersey, Chicago’s Cook County and the cities of Atlanta, Denver and New York among its clients. The Port Authority maintains the ports, tunnels and bridges linking Manhattan to neighboring New Jersey. PMC’s $392 million bond issue with Denver helped complete that city’s new international airport.
“We’ve been talking for a year about how we could work together,” says PMC Chairman Malcolmn Pryor. “When younger people like Don Rice come to the table with strong ideas and good strategies, you want to listen. And we’ve come to the conclusion that it’s wise to join forces with him.”