This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Nationstar Announces Launch Of Capital-Light Servicing Acquisition Structure & Investor Call To Discuss Structure

Nationstar Mortgage Holdings Inc. (NYSE:NSM):

  • Initial transaction: sale of advances of $3.2 billion with potential for up to $6.3 billion
  • Related sale of RMSRs on $58 billion of UPB with potential for up to $130 billion of UPB
  • Unlocks up to $681 million in advance equity to be redeployed into high-return opportunities
  • Increases balance sheet efficiency with a low-cost structure that can be deployed on future acquisitions
  • Eliminates advance interest expense and future advance obligations on transaction portfolio
  • Generates long-term, fee-based revenue streams to Nationstar

Nationstar Mortgage Holdings Inc. (NYSE:NSM) (“Nationstar”) announced today the launch of a new, capital-light servicing acquisition structure. Nationstar Mortgage LLC, a wholly-owned subsidiary, agreed to sell to New Residential (NYSE:NRZ) and other investors (“NRZ”) servicing advances of $3.2 billion with potential for up to $6.3 billion. Nationstar agreed to sell the related rights to mortgage servicing rights (“RMSRs”) of approximately $58 billion of unpaid principal balance (“UPB”) with potential for up to $130 billion of UPB.

These transactions are the first of a series in Nationstar’s planned strategic initiative to launch a low-cost, capital-light acquisition structure. These transactions enable Nationstar to unlock advance equity of $362 million, with total potential of up to $681 million for redeployment into high return opportunities. In addition to reducing Nationstar’s advance funding interest expense, Nationstar has also transferred the obligation to fund the future servicing advances of the portfolios to NRZ, improving Nationstar’s balance sheet efficiency.

The total sale price to Nationstar is $3.2 billion, with a total potential of up to $6.3 billion at substantially the same terms. Nationstar intends to use the proceeds for general corporate purposes, including new servicing portfolio acquisitions and potentially retiring corporate debt.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG

Markets

DOW 18,080.14 +21.45 0.12%
S&P 500 2,117.69 +4.76 0.23%
NASDAQ 5,092.0850 +36.0220 0.71%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs