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IPO / M&AMortgage

Upcoming IPO could value loanDepot at $6.5B

Anthony Hsieh-led firm aims to raise approximately $300M in public offering

LoanDepot, one of America’s largest mortgage lenders, released pricing of its hotly anticipated independent public offering (IPO) on Wednesday. The multichannel lender said it would be selling 9.41 million shares of common stock; funds held by its private equity backer Parthenon Capital Partners would sell 5.59 million shares in the upcoming IPO. The offering price is expected to be between $19.00 and $21.00 per share.

At the midpoint range of $20 per share, loanDepot would raise $300 million. That would give loanDepot a market cap of approximately $6.5 billion, according to analysts at Renaissance Capital.

Founded by CEO Anthony Hsieh, the Orange County, California-based lender intends to grant its underwriters a 30-day option to purchase additional common stock shares from loanDepot.

Goldman Sachs & Co. LLC, BofA Securities, Credit Suisse and Morgan Stanley are acting as lead book-running managers for the proposed offering. Barclays, Citigroup, Jefferies and UBS Investment Bank will be book running managers, and JMP Securities, NomuraPiper SandlerRaymond JamesWilliam Blair and AmeriVet Securities will act as co-managers for the proposed offering.

In its S-1, loanDepot revealed that its market share had grown from just over 1% in 2014 to 2.6% as of Sept. 30, 2020. The lender generated $3.4 billion in revenue in the 12 months that ended Sept. 30. It is now the second-largest retail-focused independent mortgage bank in America, and the fifth largest overall retail originator, according to Inside Mortgage Finance.

In September, Bloomberg reported that loanDepot, which operates in retail, wholesale and correspondent channels, was eyeing an IPO that would see it valued at between $12 billion and $15 billion.

LoanDepot, backed by private equity firm Parthenon Capital Partners, first announced plans to go public in September 2015 but canceled the IPO just hours before pricing, citing adverse “market conditions.” At the time, LoanDepot had sought a market value of $2.4 billion to $2.6 billion.

In March 2017, the company revived plans for an IPO but didn’t follow through.

The company’s S-1 shows fat profits through 2020. LoanDepot posted net income of $1.47 billion for the first nine months of 2020, up significantly from the $18 million it posted during the same period in 2019.

LoanDepot’s rivals Rocket Companies, United Wholesale Mortgage and Homepoint are all likely to have gone public before the California-based lender lists on the New York Stock Exchange under the ticker symbol LDI.

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