Altisource to Buy Fee-Based Businesses from Ocwen for $218.6M

Altisource to Buy Fee-Based Businesses from Ocwen for $218.6M

BY: ESTHER CHO

Altisource Portfolio Solutions announced it is purchasing certain fee-based businesses from Ocwen Financial for a combined purchase price of $218.6 million.

According to a company release, Altisource entered into non-binding letters of intent with Ocwen to acquire certain fee-based businesses related to the servicer’s recent purchase of Homeward Residential and the anticipated purchase of the mortgage servicing platform from Residential Capital.

The letter of intent for the Homeward’s fee-based businesses gives Altisource all of the capital stock of Beltline Road Insurance Agency, Power Default Services, Power REO Management Services, and Power Valuation Services. Altsource will also acquire the mortgage asset recovery special services division of Stratus Asset Management Group and certain intellectual property and information technology assets of Homeward Residential’s platform.

In addition, Altisource will acquire certain fee-based businesses related to default management and charge-off services, designated intellectual property, and information technology assets related to ResCap.

“These fee based business acquisitions are strategically valuable to Altisource, helping us maintain our business model with Ocwen, expanding our footprint and providing significant revenue and earnings growth to Altisource,” said William B. Shepro, CEO of Altisource, in a release.

“By selling these non-core assets, Ocwen is able to achieve a greater projected return on the Homeward and ResCap servicing acquisitions and to continue to focus primarily on growing our core residential and commercial servicing businesses. Having an outlet for disposition of peripheral mortgage-related assets significantly enhances Ocwen’s competitive positioning for future servicing platform acquisitions that include non-core operations,” added Ronald M. Faris, CEO of Ocwen.

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