C-BASS Buying Fieldstone for $260M

Credit-Based Asset Servicing and Securitization LLC -- which is backed by two mortgage insurance giants -- has agreed to pay $260 million for Fieldstone Investment Corp., Columbia, Md., a publicly traded nonprime lender.As of midday Friday, Fieldstone's shares had almost doubled in value to just over $5 each. Fieldstone services just shy of $6 billion in loans, ranking 28th among subprime firms, according to the Quarterly Data Report. It ranks 24th among subprime lenders. C-BASS -- a specialty servicer controlled by MI giants MGIC and Radian -- said it would pay $5.53 a share for the mortgage banking REIT, which lost $37.2 million through the first nine months of last year. According to a statement issued by the companies, the per-share purchase price is subject to a $0.20 reduction "in the event Fieldstone does not complete settlement of certain litigation pending prior to the merger." The company is a defendant in at least four civil cases, involving different matters, including a shareholder suit that could cost it $19 million.