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Home Point Financial Corporation and Stonegate Mortgage Corporation have announced they have entered into an agreement for Home Point to acquire Stonegate Mortgage in an all-cash transaction valued at approximately $211 million. Under the terms of the agreement, Stonegate Mortgage's stockholders will receive $8.00 per share. The per share price represents a premium of approximately 61 percent over Stonegate Mortgage's 90-day volume weighted average price on Jan. 26, 2017, and a 34 percent premium over Stonegate Mortgage's closing price per share on Jan. 26, 2017.
The Stonegate acquisition is the latest move where Home Point has shown significant growth, beginning with a fall-2014 acquisition of Maverick Funding, an expansion of the firm's Reverse Mortgage Division and TPO Production team, and expansion of its Third-Party Channel.
"We are very excited about the opportunity to work together with the Stonegate Mortgage team to accelerate the build out of Home Point Financial," said Willie Newman, Home Point's chief executive officer. "The combined business will have full national coverage across all channels of mortgage origination, as well as vertical integration across the mortgage value chain. Most important, the talent and experience of the combined team will give us the ability to fulfill Home Point's vision of being a leader in mortgage banking and financial services."
Stonegate Mortgage's board of directors unanimously approved the transaction following a review of the transaction and strategic alternatives. The transaction is subject to certain customary closing conditions, including, among other things, approval by Stonegate Mortgage's stockholders and regulatory approvals. The transaction is expected to close by the end of the second quarter of 2017.
"The combination of Stonegate Mortgage and Home Point Financial creates an exciting opportunity for our company, our associates and our customers,” said Jim Smith, chief executive officer of Stonegate Mortgage. “We look forward to joining forces with the Home Point Financial team and building a best in class mortgage origination and servicing platform focused on delivering value to our customers."