Mr. Cooper Group Inc. and Home Point Capital Inc. have announced the signing of a definitive agreement for Mr. Cooper to acquire all outstanding shares of Home Point for approximately $324 million in cash. As part of the transaction, Mr. Cooper will assume $500 million in outstanding Home Point 5% senior notes which are due in February 2026. The transaction is expected to close in Q3 of 2023, subject to customary closing conditions including receipt of regulatory approvals. Following the onboarding of Home Point customers and the closing of the transaction, Mr. Cooper will shut down the remaining Home Point operations.
“This acquisition is consistent with our strategy of growing our customer base, deploying our capital with a focus on attractive risk-adjusted returns, and maintaining a very strong balance sheet,” said Mr. Cooper’s Chairman and CEO Jay Bray. “Home Point has amassed an impressive servicing portfolio, consisting of conventional loans to borrowers with high FICO scores, low coupons, and strong equity cushions. We look forward to welcoming these customers to Mr. Cooper and providing them with a high-quality, personalized, and friction-free experience.”
Wachtell, Lipton, Rosen & Katz and Simpson Thacher & Bartlett LLP acted as legal advisors to Mr. Cooper. Kirkland & Ellis acted as legal advisor to Home Point, and Houlihan Lokey acted as financial advisor to Home Point.
Last month, Ann Arbor, Home Point entered into a definitive agreement to sell certain assets of the company’s wholesale originations channel to The Loan Store Inc., a national wholesale lender headquartered in Tucson, Arizona. Founded in 2019, The Loan Store is a provider of conventional, jumbo, VA, and non-QM offerings.
“Thanks to our strong operations and technology, we have the capacity to onboard this portfolio, with a focus on ensuring a positive customer experience,” added Kurt Johnson, Mr. Cooper’s CFO. “The senior notes we’re assuming from Home Point serve as a low-cost source of funding and contribute to an attractive rate of return on this transaction.”