Rocket Cos, parent of Quicken Loans, is preparing a major initial public offering for later this week.
The Detroit company is set to go public by raising as much as $3.3 billion.
The Wall Street Journal reported, citing Dealogic data, that for this year, this offering would be second in size only to the $4 billion that the hedge-fund manager Bill Ackman raised last month with his blank-check company Pershing Square Tontine.
Rocket, founded in 1985, is expected to price the IPO late Wednesday and start trading on Thursday, the Journal reported. The stock symbol is RKT.
In a Form S-1 filed July 28 with the Securities and Exchange Commission, Rocket said it was offering 150 million shares at $20 to $22 each. The underwriters also have an option on 22.5 million more shares at the IPO price.
Rocket's founder and chairman, Dan Gilbert, through a separate class of stock will hold 79% of the combined voting power of the common stock.
The mortgage market is one of the rare exceptions to the rule that the coronavirus pandemic has crushed the U.S. economy.
Mortgage rates are rock bottom and homeowners are refinancing. And the Journal points out that a tight housing supply has kept home prices high. Many younger people are moving to the suburbs and wealthier city residents are looking for second homes.
At the same time, with consumers crunched by the loss of their jobs during the pandemic, many consumer lenders are awaiting what could be a rush of loan defaults later this year.
For the 2020 first quarter, Rocket reported net income of $97.3 million, swinging from a net loss of $299.3 million for the year-earlier quarter. Revenue more than doubled to $1.37 billion from $631.8 million a year earlier.
Among the risk factors the company lists, covid-19 is first.
"While the pandemic's effect on the macroeconomic environment has yet to be fully determined and could continue for months or years," the SEC filing says, "we expect that the pandemic, and governmental programs created as a response to the pandemic, will affect the core aspects of our business.
"[These include] the origination of mortgages, our servicing operations, our liquidity and our employees. Such effects, if they continue for a prolonged period, may have a material adverse effect on our business and results of operation."