Option One Mortgage gets debt commitment to back buyout by Cerberus

By Sara Rosenberg

New York, April 20 - Option One Mortgage Corp. has received a debt commitment to help fund its buyout by Cerberus Capital Management, LP, according to an 8-K filed with the Securities and Exchange Commission Friday.

Under the transaction agreement, OOMC Acquisition Corp., a newly formed company affiliated with Cerberus, will purchase Option One from H&R Block Inc. for the value of the tangible net assets of the business at the date of closing, less $300 million. At Jan. 31, the tangible net assets of Option One were $1.27 billion.

Closing is anticipated to happen during H&R Block's fiscal second quarter ending Oct. 31, subject to various closing conditions.

Bear Stearns and Wachovia acted as the financial advisors to Cerberus on the transaction, a company spokesperson told Prospect News.

Option One is an Irvine, Calif., wholesale originator and servicer of non-prime residential mortgage loans.

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