Tampa, Fla.-based Walter Investment Management Corp. has entered into a definitive agreement to purchase Spring, Texas-based Reverse Mortgage Solutions Inc. (RMS) in a transaction valued at $120 million.
In announcing the acquisition, Walter Investment anticipates the acquisition of RMS will be ‘significantly accretive to both earnings and cashflow.’ The company adds that the $120 million transaction value represents a multiple of approximately 2.6 times RMS' expected 2012 EBITDA, or 4.1 times RMS's 2012 expected core earnings.
RMS is the nation's fourth largest reverse mortgage servicer and the second largest issuer of reverse mortgage-backed Ginnie Mae securities. The company has approximately 330 employees.Â
‘We believe RMS is uniquely positioned to capitalize on this opportunity and to continue capturing greater market share in both its origination and servicing businesses,’ says Mark J. O'Brien, chairman and CEO of Walter Investment. ‘We believe the combined strengths of our businesses will enhance our ability to take advantage of these opportunities.’