Adding to the drama of a saga that has confused both industry insiders and trade press alike, TMSF Holdings, Inc. said Tuesday that it has terminated its agreement to purchase the wholesale operations of Fulsom, Calif.-based Central Pacific Mortgage, which shut down earlier this week due to an inability to make payroll for its more than 260 employees. “We determined that proceeding with the asset acquisition agreement was not, as originally perceived, in the best interest of TMSF Holdings shareholders,� commented Raymond Eshaghian,CEO of TMSF Holdings, Inc. “TMSF will pursue other opportunities in the marketplace that will better serve our shareholders.� No further reason was provided for TMSF's exit, and calls to both CPM and TMSF representatives for comment were not returned by press deadlines on Tuesday.
TMSF, which owns and operates The Mortgage Store retail origination franchise nationwide, had orginally agreed to purchase the wholesale operations of Central Pacific of February 14. Central Pacific's wholesale business originated approximately $180 million in conforming, jumbo and Alt-A loans, with approximately 55 percent of loan volume classified as Alt-A paper. Terms of the original deal were not disclosed. Rumblings of troubles with the deal reached a fever pitch in late February, when Central Pacific shut its doors, stating it could not make payroll. At that time, no further details regarding the fate of the CPM wholesale transaction were made available, with TMSF representatives referring the press to their earlier announcement of purchase. Housing Wire reported on March 2 regarding the ongoing troubles at Central Pacific, which industry sources said were rooted in the company's escalating repurchase obligations. With TMSF's decision not to go forward with the purchase of Central Pacific's wholesale operations, it now appears that the entire company has folded due to the same repurchase claims. Central Pacific owned a healthy retail franchise of its own under its Ivanhoe Mortgage division, which it had acquired in March 2006; the division produced more than $2 billion in mortgage volume annually, according to company records. Many former Central Pacific and Ivanhoe employees have been granting press interviews over what they saw as unfair treatment by former CPM CEO John Courson, who had repeatedly assured employees that their jobs were safe. "It now looks like he [Courson] may have thought that the jobs were safe, right up until TMSF pulled the rug out from under Central Pacific," said one source, on condition of anonimity.
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