New Residential Acquires Caliber Home Loans
On April 14, 2021, New Residential Investment Corporation announced in a press release that it partnered with a Lone Star Funds affiliate to acquire Caliber Home Loans. The transaction is likely to close in the third quarter of 2021.
The President, CEO, and Chairman of New Residential, Michael Nierenberg, said: “The combination of NewRez and Caliber’s platforms will create a premier financial services company with scale, talent, technologies, and products to accelerate our mortgage company objectives and generate strong earnings for our shareholders. With this acquisition, we have significantly strengthened our capabilities to perform across interest rate environments.”
New Residential is a publicly traded trust that focuses on investing in the residential housing sector. The company’s portfolio includes mortgage servicing-related assets, non-agency securities, and residential loans, to name a few.
Caliber Home Loans is a mortgage originator best known for providing financial solutions for people with less-than-perfect credit scores. Caliber customers can choose between government loans and several conventional home loan options.
Judging by what Sanjiv Das, its CEO, said, Caliber Home Loans seems to be just as pleased with the acquisition: “By combining platforms with NewRez, we will join another industry pioneer that has complementary strengths and is committed to delivering the dream of homeownership.”
According to the statement, obtaining Caliber will cost New Residential $1.675 billion. The company has priced 45,000,000 shares of its common stock at $10.10 per share to fund this venture.
New Residential hopes that the acquisition of Caliber will benefit its borrowers by growing its earnings, adding to its asset base, accelerating its platform objectives, and improving the technologies that support its customers’ experience.
With the financial future of the world as unpredictable as it is at the moment, the prospect of having more quality loan products in one place is sure to delight many.
I have always thought of myself as a writer, but I began my career as a data operator with a large fintech firm. This position proved invaluable for learning how banks and other financial institutions operate. Daily correspondence with banking experts gave me insight into the systems and policies that power the economy. When I got the chance to translate my experience into words, I gladly joined the smart, enthusiastic Fortunly team.
