On Thursday, Ocwen Financial Corporation announced that it had completed the acquisition of PHH Corporation for approximately $360 million in cash, or $11 per diluted common share. Concurrent with the closing of the PHH merger, Ocwen announced that Glen A. Messina had become the President and CEO of Ocwen and a member of Ocwen’s Board of Directors.
“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, in a statement.
The newly combined company, as of June 30, 2018, services approximately 1.7 million loans with an unpaid principal balance of over $296 billion. In 2017, the combined company originated more than $3 billion of residential mortgage loans, including reverse mortgages.
“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. We are excited to officially welcome Glen Messina and the PHH employees to the Ocwen family,” Caldwell said.
The increased size and scale of the merged entity has created strategic and financial benefits such as reduction in servicing and origination costs as well as fixed costs through the reduction of redundant corporate and overhead costs. Ocwen said that the new entity would also provide a foundation to enable the combined servicing platform of both the companies to resume new business and growth activities to offset their portfolio runoff. "The annual run rate synergies are now targeted at $100 million," Ocwen said.