New Residential to mix NewRez and Caliber platforms into premier monetary providers firm
Buy Value to Tangible E-book A number of of 1.0x1
Provides $141 Billion UPB of MSRs
Mixture of Complementary and Main Mortgage Platforms
Broadens Buyer Retention Efforts with Sturdy Recapture Platform
Enhances Buy Origination Capabilities with In depth Retail Footprint
Will increase Asset Technology Capabilities and Alternatives
Accretive to 2022 Return on Fairness2
New Residential Funding Corp. (NYSE: NRZ; “New Residential” or the “Firm”) introduced at the moment that it has entered right into a definitive settlement with an affiliate of Lone Star Funds (“Lone Star”) to amass Caliber Dwelling Loans, Inc. (“Caliber”). With this acquisition, New Residential intends to carry collectively the platforms of Caliber and NewRez LLC (“NewRez”), New Residential’s wholly owned mortgage originator and servicer. The transaction is meant to shut as rapidly as potential, topic to varied approvals and customary closing situations, and is focused for the third quarter of 2021.
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“We imagine this can be a terrific acquisition for our Firm,” mentioned Michael Nierenberg, Chairman, Chief Government Officer and President of New Residential. “Through the years, Caliber’s skilled workforce has constructed a differentiated purchase-focused originator with a formidable retail franchise and strong monitor report in client retention. The mix of NewRez and Caliber’s platforms will create a premier monetary providers firm with scale, expertise, applied sciences and merchandise to speed up our mortgage firm goals and generate sturdy earnings for our shareholders. With this acquisition, we have now considerably strengthened our capabilities to carry out throughout rate of interest environments.”
“We’re excited to be becoming a member of the New Residential household,” mentioned Sanjiv Das, Chief Government Officer of Caliber. “By combining platforms with NewRez, we are going to be a part of one other enterprise pioneer that has complementary strengths and is dedicated to delivering the dream of homeownership. Our mixture of methods will enable us to speed up our main place in buy lending, develop our digital direct to client and dealer initiatives, and additional propel our retail franchise. As we leverage our digitization investments, we are going to make all the mortgage course of sooner, simpler and extra environment friendly. We’re thrilled to have the chance to deepen our client relationships, develop our client attain and supply extra industry-leading merchandise and choices to our clients.”
“This transaction is yet one more necessary milestone for NewRez as we proceed to develop our enterprise, develop our client attain and supply extra choices to help our owners and purchasers,” mentioned Baron Silverstein, President of NewRez. “Combining with Caliber’s platform emphasizes our dedication to positioning our enterprise for long-term success whereas persevering with to ship vital worth for our clients, our companions and our workers.”
The mix of platforms is meant to carry collectively two complementary main mortgage methods with deep commitments to the debtors they serve.
Chief within the giant and rising United States mortgage market
$80 billion UPB of funded origination quantity in 2020
$153 billion UPB servicing portfolio with roughly 630,000 clients as of December 31, 2020
Recapture charge of 54% demonstrates energy of Caliber’s built-in mortgage platform
Broad distributed retail platform with intensive native footprint throughout the USA
Confirmed monitor report of buy origination quantity and profitability throughout charge environments
2020 Pre-Tax Revenue of $891 million and return on fairness of 53%
Engaging earnings efficiency and monetary profile
Beneath the phrases of the settlement, which had been unanimously accepted by New Residential’s board of administrators, New Residential pays a money consideration of $1.675 billion, or roughly 1.0x anticipated tangible ebook worth at closing1, to amass Caliber.
New Residential intends to finance the acquisition by means of a mixture of current money and out there liquidity on the New Residential and Caliber mixed steadiness sheet in addition to a mixture of fairness and the sale of sure funding securities.
Citigroup World Markets Inc. and Goldman Sachs & Co. acted as monetary advisors to New Residential and Skadden, Arps, Slate, Meagher & Flom LLP acted as authorized advisor to New Residential. Credit score Suisse Securities (USA) LLC and Barclays acted as monetary advisors to Lone Star and Caliber and Mayer Brown LLP acted as authorized advisor to Lone Star and Caliber.
Investor Name Particulars
New Residential will host a convention name at 8:00 A.M. Japanese Time on Wednesday, April 14, 2021 to debate the acquisition. A supplemental presentation discussing the acquisition is obtainable at newresi.com/traders. The convention name could also be accessed by dialing 1-866-777-2509 (from throughout the U.S.) or 1-412-317-5413 (from exterior of the U.S.) ten minutes previous to the scheduled begin of the decision; please reference “New Residential Acquisition Name.” As well as, contributors are inspired to pre-register for the convention name at https://dpregister.com/sreg/10154271/e6332ce6a8. A simultaneous webcast of the convention name might be out there to the general public on a listen-only foundation at www.newresi.com. Please enable further time previous to the decision to go to the web site and obtain any essential software program required to take heed to the web broadcast.
This press launch doesn’t represent a proposal to promote or the solicitation of a proposal to purchase shares of frequent inventory, nor shall there be any sale of those securities in any jurisdiction wherein such supply, solicitation or sale could be illegal previous to registration or qualification beneath the securities legal guidelines of any such jurisdiction.
ABOUT NEW RESIDENTIAL
New Residential is a number one supplier of capital and providers to the mortgage and monetary providers enterprise. The Firm’s mission is to generate engaging risk-adjusted returns in all rate of interest environments by means of a portfolio of investments and working companies. New Residential has constructed a diversified, hard-to-replicate portfolio with high-quality funding methods which have generated returns throughout totally different rate of interest environments over time. New Residential’s portfolio consists of mortgage servicing associated belongings (together with investments in working entities consisting of servicing, origination, and affiliated companies), residential securities (and related known as rights) and loans, and client loans. New Residential’s investments in working entities embody its mortgage origination and servicing subsidiary, NewRez, and its particular servicing division, Shellpoint Mortgage Servicing, in addition to investments in affiliated companies that present providers which can be complementary to the origination and servicing companies and different portfolios of mortgage associated belongings. Since inception in 2013, New Residential has a confirmed monitor report of efficiency, rising and defending the worth of its belongings whereas producing engaging risk-adjusted returns and delivering over $3.6 billion in dividends to shareholders. New Residential is organized and conducts its operations to qualify as an actual property funding belief (REIT) for federal revenue tax functions. New Residential is managed by an affiliate of Fortress Funding Group LLC, a world funding administration agency, and headquartered in New York Metropolis.
NewRez is a number one nationwide mortgage lender and servicer. As a lender, NewRez focuses on providing a breadth of industry-leading merchandise, supported by a loan course of that blends each human interplay and the advantages of know-how into an unparalleled client expertise. Based in 2008 and licensed to lend in 50 states, NewRez is headquartered in Fort Washington, Pennsylvania and operates a number of lending channels, together with Direct to Client, Joint Enterprise, Wholesale and Correspondent. The servicing enterprise operates by means of NewRez Servicing, the performing loan servicing division, Shellpoint Mortgage Servicing, the particular servicing division. NewRez additionally has a number of associates that carry out varied providers within the mortgage and actual property industries. These embody Avenue 365 Lender Providers, LLC, a title company, and eStreet Appraisal Administration LLC, an appraisal administration firm. NewRez is member of the New Residential household.
Caliber is a confirmed chief within the U.S. mortgage market with a diversified, customer-centric, purchase-focused platform with headquarters in Coppell, Texas. Caliber is an accepted Vendor/Servicer for each Fannie Mae and Freddie Mac, an accepted issuer for Ginnie Mae and is an accepted servicer for FHA, VA and the USDA. Caliber carries a number of servicer scores from Commonplace & Poor’s, Moody’s, Fitch and DBRS.
Sure data on this press launch constitutes “forward-looking statements” throughout the which means of the Non-public Securities Litigation Reform Act of 1995, together with, however not restricted to, (i) statements concerning the Transaction, together with the flexibility to acquire all required approvals and consummate the Transaction on a well timed foundation or in any respect, (ii) Caliber’s future efficiency, together with its capacity to develop, and (iii) statements concerning Caliber’s affect on the Firm’s enterprise and future efficiency. These statements should not historic info. They symbolize administration’s present expectations concerning future occasions and are topic to various tendencies and uncertainties, lots of that are past our management, which might trigger precise outcomes to vary materially from these described within the forward-looking statements. Accordingly, you shouldn’t place undue reliance on any forward-looking statements contained herein.
For a dialogue of among the dangers and necessary elements that would have an effect on such forward-looking statements, see the sections entitled “Cautionary Statements Relating to Ahead Wanting Statements,” “Threat Elements” and “Administration’s Dialogue and Evaluation of Monetary Situation and Outcomes of Operations” within the Firm’s most up-to-date annual and quarterly experiences and different filings filed with the U.S. Securities and Change Fee, which can be found on the Firm’s web site (www.newresi.com). New dangers and uncertainties emerge occasionally, and it isn’t potential for New Residential to foretell or assess the affect of each issue which will trigger its precise outcomes to vary from these contained in any forward-looking statements. Ahead-looking statements contained herein converse solely as of the date of this press launch, and New Residential expressly disclaims any obligation to launch publicly any updates or revisions to any forward-looking statements contained herein to mirror any change in New Residential’s expectations with regard thereto or change in occasions, situations or circumstances on which any assertion relies.
1 Primarily based on estimated closing tangible ebook worth at September 30, 2021, topic to sure downward changes.
2 Refers to projected 2022 Return on Fairness.
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New Residential Investor Relations
Head of Investor Relations
NewRez Public Relations
Caliber Investor Relations
Caliber Public Relations