NEW YORK — E. F. Hutton Group's leader acknowledged publicly Wednesday that the Oct. 19 stock market crash and its aftermath compelled the troubled brokerage to seek a merger partner or cash infusion.
The statement by Robert Rittereiser, president and chief executive, marked the first explanation from management of why Hutton was abandoning independence since the firm disclosed Monday that it was up for sale.
Rittereiser made the statement in a memorandum to all employees and released it to the press.
"The board's decision to pursue an additional capital infusion or a strategic combination comes at a time when we have performed well overall and continue to grow in certain markets," Rittereiser said.
"However, the events of the last few weeks have altered the conditions under which we compete, including creating new long-term capital demands," he said. "Prudence requires that we pursue this course to assure our stockholders, employees and clients continued success. We expect this process to be conducted and concluded rapidly."