Dimont & Associates terminates Wingspan relationship

Returns to independent operations

Dimont & Associates, which was acquired by Wingspan Portfolio Advisors in May 2013, announced Thursday that it terminated its relationship with Wingspan, as a result of “recapitalization by existing institutional investors including THL Credit (TCRD).”

When Wingspan acquired Dimont & Associates, the two companies said that Dimont would continue to operate under the management of the company’s founder and president, Bernie Dimont, as a wholly-owned subsidiary of Wingspan.

"We will retain the Dimont name, leadership and company structure, and leverage its brand power in the claim recovery services arena, where Dimont is already successfully managing claims for many of the country's highest volume servicers and GSEs," said Steve Horne, CEO of Wingspan said when the deal was announced.

The acquisition of Dimont, a hazard insurance claims management company, was rumored to be one of the reasons for Horne’s supposed ouster as Wingspan’s CEO earlier this month.

One source told HousingWire that the Dimont deal required Wingspan to take on mezzanine debt, which was allegedly new to Wingspan’s operations.

According to THL Credit’s most recent filing with Securities and Exchange Commission (which can be seen here), THL Credit owned $18.8 million of Wingspan’s subordinated debt related to the Dimont acquisition, at an interest rate of 15.5%. The loan had a maturity date of Nov. 21, 2016.

A source told HousingWire that Wingspan’s debt holders began to grow unsteady when Wingspan allegedly failed to pay even the first payment due. The source said that Dimont was allegedly divested from the company in order to satisfy the debt taken on for its very purchase.

According to Dimont, the company will now operate independently and will maintain its headquarters in Dallas, Texas with an additional office location in San, Diego, California.

“Dimont’s unique expertise in servicing a diverse client base is a clear advantage when it comes to offering a customized approach for each client and the flexibility required to address rapid fluctuations in portfolio size,” Bernie Dimont said of the company’s new independence.

"THL Credit recognizes the strength of Dimont’s management team and our commitment to the customer, which is unmatched in the industry.  We are excited to have strong financial partners who will support the company's continued growth.”

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