PHH Corp. is now officially part of Ocwen Financial, as Ocwen’s $360 million acquisition of PHH is now complete, the companies announced Thursday morning.
Last week, Ocwen announced that the acquisition had received approvals from all relevant regulatory agencies and was set to close in 10 days or less. And now, less than one week later, it’s officially a done deal.
Going forward, PHH will operate as a wholly-owned subsidiary of Ocwen. And given that the deal is now complete, PHH has been delisted from the New York Stock Exchange.
But those aren’t the only big changes for Ocwen and PHH.
In conjunction with the deal’s closing, former PHH CEO Glen Messina has officially taken over as president and CEO of Ocwen.
Just a few months after the Ocwen-PHH deal was announced, Ocwen announced that Messina, who ran PHH from 2012 to June 2017, would replace Ron Faris as Ocwen president and CEO when the deal was completed.
Messina served as president and CEO of PHH from January 2012 to June 2017. Messina came to PHH as chief operating officer in 2011 after spending 17 years at General Electric Company, including most recently serving as CEO of GE Chemical and Monitoring Solutions from 2008 through 2011.
Messina’s tenure at PHH saw the company go through several rough patches as it tried to weather a changing time in the mortgage business.
Back in 2014, PHH sold off its fleet business in an attempt to focus on the company’s struggling mortgage performance. Then, Bank of America and HSBC both pulled massive servicing portfolios from PHH.
The company later sold off its entire mortgage servicing rights portfolio in late 2016, then shifted its mortgage origination focus significantly, exiting private-label originations and ending its joint mortgage venture with Realogy Holdings Corp.
Messina then left PHH in 2017 amid an executive shakeup, but now’s back to run the company that just bought the company he used to run.
Messina officially takes over for John Britti, Ocwen’s executive vice president and chief investment officer, who had been serving as interim CEO after Faris stepped down earlier this year.
“The close of this acquisition marks a new chapter in our history, and creates a strong non-bank mortgage servicer, positioned for growth, and better able to serve borrowers and loan investors,” said Phyllis Caldwell, chair of Ocwen’s board of directors.
“We believe our increased size and scale will create both strategic and financial benefits including accelerating our transition to an industry leading servicing platform, reducing servicing, originating and overhead costs on a combined basis through the realization of $100 million in targeted cost synergies and improved economies of scale, and providing a foundation to enable Ocwen to resume new business and growth activities to offset portfolio runoff in the future,” Caldwell continued. “We are excited to officially welcome Glen Messina and the PHH employees to the Ocwen family.”
As Caldwell noted, the combined company expects to achieve $100 million in “cost synergies,” via reduced costs and other measures.
The company also expects the acquisition to speed up its transition to Black Knight’s LoanSphere MSP servicing system, a move necessary after dozens of states stipulated that Ocwen must move away from its proprietary RealServicing platform, which caused many servicing and escrow issues for borrowers.
The newly combined company services approximately 1.7 million mortgages that carry an unpaid principal balance of more than $296 billion. Last year, the combined company originated more than $3 billion of residential mortgages, including reverse mortgages.