On Monday, Ditech Holding Corporation announced it is entering into its second Chapter 11 bankruptcy agreement since 2017, citing added pressure from accelerated market challenges for the push to take further action. Thomas F. Marano, President and CEO of Ditech, said, "Since we completed a recapitalization last February, we have made important progress on our strategic initiatives and our expense management effort.” Although signs of financial trouble persist, the company is seeking authorization to continue operations in the ordinary course of business, according to a number of first-day motions filed with the U.S. Bankruptcy Court for the Southern District of New York. In connection with the court-supervised process, Ditech has received commitments for up to $1.9 billion in debtor-in-possession financing to support its operations during the Chapter 11 process.
Under the Restructuring Support Agreement, Ditech will pursue a recapitalization that extinguishes over $800 million in corporate debt, while the company simultaneously continues to consider a broad range of options. This includes a potential sale of the company and/or a sale of all or a portion of the company's assets, and changes to the company's business model.
Marano added, "As we move forward, we remain firmly committed to our mission of serving customers through the homeownership journey. I want to thank our employees for their continued dedication to serving our customers. Our people will continue to be the driving force behind our success." In an effort to provide more information Ditech and RMS sent letters to their customers and put out FAQs about the process on Ditech Holding's website in addition to the Company's Restructuring Hotline, toll-free at 866.486.4809 or 503.597.7698 for calls originating outside of the U.S.
Additional court filings and other documents related to the court proceedings are available by clicking here.