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WMIH strikes deal for NSM
Posted on Tuesday, 13 February 2018 14:58
WMIH is acquiring Nationstar Mortgage Holdings (NSM), credited as being the largest non-bank servicer in the US, for an aggregate USD 3.80 billion including debt.
Through flagship brand Mr Cooper, the Texan company provides servicing, origination and transaction-based services related principally to single-family residences throughout the States.
NSM has a residential mortgage servicing portfolio of USD 533.00 billion in unpaid principle balance, 3.30 million customers, and USD 19.00 billion in annual originations, as of 30th September 2017.
The offer comprises either USD 18.00 apiece in cash or 12.78 new WMIH shares, subject to an overall proration to ensure that 32.0 per cent of outstanding securities are exchanged for stock consideration.
In all, the deal comprises a monetary payment of USD 1.20 billion, USD 702.00 million-worth of scrips and the assumption of USD 1.90 billion of existing senior unsecured notes that will be refinanced at closing.
WMIH was formerly known as Washington Mutual and its operations mainly consist of a legacy reinsurance business that is currently operated in runoff mode by wholly-owned Hawaiian subsidiary WM Mortgage Reinsurance.
The group is focused on identifying and completing a value-added acquisition across a broad array of industries, with a primary focus on the financial institutions sector.
In addition to certain legacy reinsurance assets and non-recourse run-off liabilities, WMIH has some USD 600.00 million in cash and equivalents, and federal net operating loss carry forwards of USD 6.00 billion.
The group’s largest shareholder is KKR with 24.0 per cent of the voting stocks, and this investor has agreed to support the acquisition that will dilute its ownership to 17.0 per cent, on a pro forma basis.
Fortress holds 68.0 per cent of NSM voting rights and has agreed to elect for cash payment for 34.00 million scrips, subject to proration.
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