Mr. Cooper extends deadline to acquire Home Point Capital’s outstanding shares

Depositary for tender offer indicated 98.2% of the outstanding shares had been validly tendered into and not validly withdrawn

Texas-based Mr. Cooper Group has extended the deadline of its tender offer to acquire Home Point Capital’s outstanding shares, the company announced on Wednesday. The offer, which was previously scheduled to end on June 27, will expire on July 21. 

The tender offer is part of Mr. Cooper’s agreement to acquire Home Point Capital, which also includes the payment of $324 million in cash. In addition, Mr. Cooper is assuming $500 million in outstanding Home Point 5% senior notes due in February 2026, per the deal announced in May

Heisman Merger Sub, a subsidiary of Mr. Cooper Group, is paying $2.33 per share net to the seller in cash, without interest thereon. 

Mr. Cooper said that the depositary Equiniti Trust Company “indicated that 136,030,882 shares had been validly tendered into and not validly withdrawn from the tender offer, representing approximately 98.2% of the outstanding shares.”

According to Mr. Cooper, the offer is conditioned to certain conditions, including consent from state mortgage regulators, the Government Mortgage Association, the Federal Home Loan Mortgage Corporation and the Federal National Mortgage Association

“The tender offer was extended to allow additional time for the satisfaction of the remaining conditions to the tender offer,” the company said in a news release. 

Mr. Cooper and Home Point Capital expect the deal to close in the third quarter of 2023.

After onboarding Home Point customers, Mr. Cooper will shut down the seller operations. In April, Michigan-based Home Point sold its wholesale origination business to The Loan Store

Mr. Cooper is acquiring Home Point’s $84 billion servicing portfolio, which will contribute to its return on equity with an estimated 10% increase to operating earnings in the first year. Mr. Cooper also estimates a tangible book value increase of about $1 per share at closing. 

Mr. Cooper had 4.1 million customers and $853 billion in unpaid principal balance (UPB) at the end of March. But the servicing portfolio is expected to grow as the company has been active in acquiring MSRs.

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