Mortgagebot Parent Davis Henderson Acquires Avista LOS

Davis Henderson, the Canadian technology company that acquired online point of sale vendor Mortgagebot for a staggering $232 million last year, completed the acquisition of loan origination system vendor Avista Solutions for $40 million, the company announced Thursday.

Charleston, S.C.-based Avista provides a browser-based LOS targeted at midsize mortgage banks and depository lenders that includes an integrated product and pricing engine, document imaging, workflow capabilities and integrations with third-party service providers. Founded in 2001, Avista has more than 150 financial institution clients and is a profitable business, according to a Davis Henderson release on the acquisition.

“With Avista, we’ve added an innovative, fast growing LOS business featuring proven capabilities that are highly synergistic to those we offer through Mortgagebot,” said Davis Henderson CEO Gerrard Schmid in a press statement. “Together, we now support the entire mortgage origination process for U.S. lenders and provide customers with a comprehensive suite of products that enable efficient, effective growth from origination through to closing.”

The Avista staff, including founder and CEO Mark Phlieger, will remain with the company.

“We believe that a combination of our innovative LOS technology and D+H’s industry leading mortgage point of sale solutions will allow us to jointly reach more customers, more rapidly, and with a more effective one-stop value proposition,” Phlieger said.

Houston-based lender Envoy Mortgage uses the Avista LOS. David Zugheri, an Envoy co-founder, said given the climate in today’s market, he’s not surprised the company was acquired and is looking forward to improvements Davis Henderson will make to the Avista technology.

“I certainly hope that now that Avista is up under a bigger umbrella, that means there will be more resources and programming and a bigger and better product,” Zugheri said in an interview with Mortgage Technology. “I’m certain that’s what’s going to happen.”

Toronto-based Davis Henderson also owns a Canadian LOS. At the time of the Mortgagebot acquisition in March 2011, some believed that the company’s strategy would be to reconfigure its LOS for the U.S. market and try to sell it to Mortgagebot’s customer base of more than 1,100 banks and credit unions. But Thursday’s deal would seem to quash those speculations, but it is yet to be seen how the company will manage its two U.S. mortgage technology assets.

Zugheri said he’d like to see Davis Henderson bring the best of the Mortgagebot and Avista technologies together, similar to the strategy that Ellie Mae is employing with its recent acquisition of LOS vendor DataTrac.

“I’m looking forward to seeing what kinds of integrations they could build and expand the Avista offering with some of the Mortgagebot features,” Zugheri said. “When you put those to together you’re going to have a Reese’s Peanut Butter Cup. It'll be a game changer."