New Residential enters into APA to acquire forward assets of Ditech Financial
New Residential Investment announced that it has entered into a "stalking horse" Asset Purchase Agreement, or APA, with Ditech Holding and Ditech Financial to purchase substantially all of the forward assets of Ditech Financial. The final purchase price will be determined at the closing of the transaction based on the tangible book value of the related assets, subject to certain agreed upon adjustments. New Residential expects to finance the acquisition of these assets with existing financing facilities and cash on hand. Under the terms of the APA, subject to certain conditions, New Residential has agreed to purchase, among other assets, Ditech Financial's forward Fannie Mae, Ginnie Mae and non-agency mortgage servicing rights, or MSRs, with an aggregate unpaid principal balance of approximately $63B as of March 31 the servicer advance receivables relating to such MSRs and other net assets core to the forward origination and servicing businesses. Additionally, New Residential has agreed to assume certain Ditech office spaces and plans to make employment offers to a number of Ditech employees. Under the APA, New Residential will not purchase any of the stock or assets related to Ditech Financial's reverse mortgage business. If New Residential's bid is successful, the transaction is expected to close in the second half of 2019, subject to certain closing conditions.