Ocwen Financial withdraws $2.2 billion in term loans from market

By Sara Rosenberg

New York, Feb. 11 - Ocwen Financial Corp. pulled from market its $2.2 billion seven-year term loan deal (B1), split between a $1.5 billion funded tranche and a $700 million delayed-draw tranche, according to a market source.

Proceeds from the term loans were slated to be used to refinance an existing $1.3 billion senior secured term loan and to fund the acquisition of mortgage servicing rights from Wells Fargo Bank on a portfolio consisting of about 184,000 loans with a total principal balance of $39 billion.

The acquisition was put on indefinite hold last week at the request of the New York Department of Financial Services, and the company decided not to move forward with the refinancing since it would have had to pay a 101 call premium to existing lenders, the source explained.

The term debt was talked at Libor plus 287.5 basis points with a 1% Libor floor and an original issue discount of 993/4, after flexing during syndication from Libor plus 325 bps with a 1% Libor floor and a discount of 991/2, and included 101 soft call protection for six months.

Wells Fargo Securities LLC, Barclays, J.P. Morgan Securities LLC and Bank of America Merrill Lynch were the joint lead arrangers and bookrunners on the deal, with Barclays the administrative agent.

Ocwen is an Atlanta-based financial services holding company that is engaged in the servicing and origination of mortgage loans.

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