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Politics & MoneyMortgage

Cash is king: UWM raises $800M in debt offering ahead of IPO

Wholesale giant will use liquidity to firm up balance sheet ahead of public debut

Man money HW+

Just weeks away from its anticipated $16.1 billion IPO, United Wholesale Mortgage (UWM) closed on the sale of $800 million in senior notes.

The bond sale, which closed this week, gave the Detroit-based mortgage giant $791 million in proceeds. The notes are due in 2025 and sold at a 5.5% coupon.

The liquidity is on top of a commitment in the form of a $500 million private placement and $425 million in cash held by the special purpose acquisition company (SPAC) UWM is merging with, Gores Holdings IV.

“The primary benefit is going to be for cash on the balance sheet and some tax obligations,” said Alex Elezaj, UWM’s chief strategy officer. “It will help us with servicing and retaining servicing so that is one strategic benefit to it, but we’re looking at it holistically, not just one particular area.”

In the run up to the IPO, CEO Mat Ishbia has said that he’s had to decide whether to spend the company’s cash on developing tech or retaining servicing. He chose tech.

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3d rendering of a row of luxury townhouses along a street

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