Ocwen Financial Corporation (NYSE:OCN) announced it has entered into an agreement on October 26th to acquire Genworth Financial Home Equity Access (GFHEA) for $22 million in cash.
The company says the deal will complement its existing mortgage related businesses.
“Genworth’s reverse mortgage business is a top-notch operation with a very strong management team and culture that emphasizes customer-service and superior quality,” said John Britti, chief financial officer & EVP of Ocwen in an email to RMD. “As a result, we believe this acquisition positions Ocwen well in the reverse mortgage business, which has enormous long-term growth potential.”
As part of the transaction, GFHEA will change its name to Liberty Home Equity Solutions and the deal is expected to close in the first quarter of 2013.
Genworth originally entered the reverse mortgage business when it acquired Liberty Reverse Mortgage in 2007 for $50 million in cash.
GFHEA has retail, wholesale and correspondent operations and is the 3rd largest originator of reverse mortgages in the country according to data from Reverse Market Insight.
Ocwen is one of the largest mortgage servicers, with a $128 billion portfolio of loans as of the second quarter of 2012. The company is also approved as a Ginnie Mae HMBS issuer, which should help to provide additional liquidity to the industry.
It’s the second acquisition in the reverse mortgage space in the last two months. In September, Walter Investment Management Corporation (NYSE AMEX:WAC) announced it was acquiring Reverse Mortgage Solutions for $122 million.
