This transaction was announced in Gleacher’s 4Q12 results release. Going forward, ClearPoint will be treated as a discontinued operation.
Gleacher said it will take a loss of almost $5 million on the sale. That is toward the high end of what was anticipated when it announced it was placing ClearPoint up for sale.
The company first acquired ClearPoint in January 2011, hoping the company would give it a competitive edge for its MBS business. The goal was for ClearPoint to originate loans based on MBS investor criteria for delivery to Fannie Mae, Freddie Mac or Ginnie Mae to be securitized.
Gleacher’s MBS unit would then purchase the securities for resale to its customers.
In August 2011, Gleacher said it planned to concentrate on growing the origination platform following a strategic review of its businesses.
However, ClearPoint has been unable to obtain agency seller/servicer approvals and instead was forced to upstream its originations to correspondent aggregators. Thus, there is no benefit to its MBS customers, Gleacher said back in November.
ClearPoint had 4Q12 net revenue of $13.6 million, up by $700,000 from 3Q12 due to improved pricing margins. But this was $7.2 million less than 4Q11 as the unit had lower origination volume.
For the full year, net revenue totaled $53.4 million, an improvement of $6.5 million for 2011.
Gleacher said until ClearPoint experienced “liquidity constraints” in the first half of the year, it had operated at or near break-even.
Continuing operations at Gleacher in 4Q12 reported a loss of $11.5 million. Restructuring impacted all areas of Gleacher in 2012.
CEO Thomas Hughes said, “While the revenue decline in MBS and rates has been natural in the face of all of our restructuring efforts in that business, we are not satisfied with those results. However, we recruited outstanding talent in this business unit, we believe our ability to serve customers in this product segment is strong, and once we have fully integrated our Rangemark capabilities with sales and trading, our customer interface will be even more compelling. We are pleased with our performance in investment banking and credit products. Our real estate finance team now ranks No. 1 in M&A transactions executed for REITs, and our credit products business grew its market share throughout 2012.”
Gleacher & Co. has found a buyer for the ClearPoint wholesale mortgage production business it put on the block last November.