Two HE Lenders Hear M&A Rumors
Subprime lender Accredited Home Loans of San Diego has seen its share price rise 20 points since late fall, fueling speculation the company might be for sale.
A spokesman for Accredited said the lender is not on the market, noting that any talk of a sale is "pure speculation." As Mortgage Servicing News went to press last month, its stock was at $53, just below its 52-week high, and significantly above its low of $31.
Most publicly traded mortgage firms these days are trading closer to their 52-week lows than their highs, a victim of tighter profit margins and lower production volumes.
Among subprime lenders, Accredited ranks 15th. A non-REIT, it is considered a conservatively managed firm that has been in business for 15 years.
In other merger and acquisition news, a deal could be close for Centex Home Equity, a midsized subprime lender based in Dallas.
Centex is owned by Centex Homes. Several banks had expressed interest in the company. Also, hedge fund Cerberus Capital Management and Citigroup have reportedly teamed up to make a bid on the residential mortgage business of General Motors.
Despite press reports on the news, an executive inside GMAC Mortgage said last week, "I have not heard those names inside the company."
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