PHH Corporation (NYSE: PHH) shares rose after the company agreed to be purchased by Ocwen Financial (NYSE: OCN) for $11 per share in cash.
Ocwen will acquire all of the Company’s outstanding shares of common stock in an all cash transaction valued at $360 million, the per-share figure representing a premium of 24% over the closing price of PHH’s common stock of $8.84 on February 26. As part of the transaction, Ocwen will assume $119 million of PHH’s outstanding unsecured debt.
Robert B. Crowl, President and Chief Executive Officer of PHH Corporation, said, “We are pleased to have reached an agreement with Ocwen for the sale of our Company.
"This decision follows a comprehensive assessment of the risks and opportunities associated with operating the business and the strategic alternatives available to us. The Board and management believe the sale of the Company to Ocwen represents the best opportunity to maximize shareholder value."
Ocwen CEO Ron Faris commented, "The combination of Ocwen and PHH will result in a strong non-bank mortgage servicer with a robust servicing capability. Ocwen will significantly benefit from PHH’s experienced workforce and their expertise on the MSP servicing platform.
"We look forward to the opportunity to provide our industry leading capabilities to PHH’s customers and servicing clients.
PHH shares galloped $2.17, or 25.4%, in Wednesday’s last hour of trading to $10.69. OCN shares gained 18 cents, or 5.3%, to $3.55.
