Reverse Mortgage Solutions to be Acquired by Walter Investment Management – NMP Skip to main content

Reverse Mortgage Solutions to be Acquired by Walter Investment Management
Sep 04, 2012

Walter Investment Management Corporation has entered into a definitive agreement to purchase Reverse Mortgage Solutions Inc. (RMS) in a transaction valued at $120 million. Consideration in the transaction consists of $60 million of cash, $25 million of WAC stock and a $35 million seller MSR note. RMS, based in Spring, Texas, provides a full suite of services to the reverse mortgage sector, including servicing, loan origination, asset management and technology. RMS has issued approximately $1.1 billion of reverse-mortgage backed Ginnie Mae securities (HBMS) in the first half of 2012, ranking it as the fourth largest reverse mortgage servicer and the second largest issuer of HMBS in the sector this year. RMS is majority-owned by funds managed by Jacobs Asset Management LLC (JAM). The acquisition of RMS will position Walter Investment as a full-service leader in the $140 billion reverse mortgage servicing sector with significant growth opportunities in each of the RMS businesses, all of which generate strong earnings and cash flow. The acquisition represents an attractive extension to Walter Investment's high-margin, fee-for-service business model. "We are extremely pleased to add the RMS business to the Walter Investment portfolio," said Mark J. O'Brien, chairman and chief executive officer of Walter Investment. "RMS is led by a very experienced and well-respected management team and has performed exceptionally well since its inception in 2007. RMS is viewed as a preeminent servicer and originator in the reverse mortgage industry. The sector has very attractive long-term growth prospects and is currently undergoing significant structural change, providing us with an opportunity to capitalize on those dynamics. We believe RMS is uniquely positioned to capitalize on this opportunity and to continue capturing greater market share in both its origination and servicing businesses. We believe the combined strengths of our businesses will enhance our ability to take advantage of these opportunities."
Sep 04, 2012
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