Lender and servicer AmeriHome on Wednesday laid out the terms of its upcoming initial public offering. The company plans to raise roughly $250 million by offering over 14.7 million Class A shares priced between $16 and $18, according to the amended S-1.
AmeriHome on Wednesday also revealed that mortgage investor Bayview Asset Management is prepared to purchase $50 million worth of shares in the offering, expected to price next week. AmeriHome, which is under the umbrella of private equity giant Apollo Global Holdings, is also expected to raise an additional $100 million in a concurrent private placement with Starwood.
Should the stock trade at the midpoint of $17 a share, AmeriHome would be valued at $1.3 billion.
The company is expected to make its debut on the New York Stock Exchange next week, trading under the ticker “AHM.”
The lender, based in Thousand Oaks, California, is a heavyweight in the correspondent channel, has a smaller consumer direct channel and sports roughly $88 billion in servicing volume. Overall production volume for the 12 months that ended on June 30 was $53.7 billion, according to the S-1.
AmeriHome produced about $27 billion in volume through its correspondent channel over the first half of the year – about 8% of the market, the company said in its S-1. That’s been the key in allowing AmeriHome to scoop up purchase loans. Last year, nearly 63% of AmeriHome’s production volume was in purchase loans through its correspondent channel.
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Though correspondent is the bedrock of AmeriHome’s business, it’s direct-to-consumer channel is also growing quickly. Per the S-1, it’s up to $2 billion in originations through the D-to-C channel.
The majority of consumer-direct origination activity is refinancing its existing customers, AmeriHome said in its S-1. “By proactively offering attractive refinancing terms to existing customers, we can minimize MSR portfolio attrition and build customer loyalty by improving their mortgage experience,” the company said.
And the servicing portfolio – where it earns fees between 25 and 56.5 basis points – as of June 30 was $87.9 billion. AmeriHome uses the bank Cenlar to subservice nearly all of its loans.
Adjusted after-tax income in 2019 was $144 million, up from $89.3 million in 2018.