Orange-based ACC Capital Holdings said Wednesday it had struck a deal with Citigroup that could result in the New York-based financial company buying ACC units Argent Mortgage Co. and AMC Mortgage Services.
Citi has a conditional deal to acquire ACC Capital’s wholesale mortgage origination and mortgage servicing businesses, subject to requirements and business milestones, the company said.
Argent funds mortgages brought to it by brokers. AMC Mortgage services mortgages.
ACC’s best-known brand, subprime lender Ameriquest Mortgage Co., which has been subject of numerous acquisition rumors in recent months, is not part of the tentative sales agreement.
The news comes as ACC Capital announced it had arranged additional financing from Citigroup. The bank has also agreed to become ACC Capital’s primary warehouse lender.
The company “has made great strides in addressing the challenges facing an industry undergoing fundamental changes,” said Aseem Mital, ACC Capital chief executive, in a statement. “This agreement provides capital and significant efficiencies to enable us to reposition our operations for long-term success.”
A deal with Citibank would be the latest example of consolidation in the local mortgage industry.
Fort Worth, Texas-based AmeriCredit Corp. recently wrapped up its buy of ACC’s Long Beach Acceptance Corp. for $282.5 million. Long Beach Acceptance makes auto loans to buyers.
H & R; Block Inc. said earlier this week it plans to sell Irvine-based subprime mortgage lender Option One Mortgage Corp. by the end of next month for $1.3 billion.
Earlier this month, Brea’s ResMae Mortgage Corp. said it was filing for bankruptcy reorganization and selling its assets to Switzerland’s Credit Suisse Group for $19 million.
Irvine subprime lender ECC Capital Corp. was recently sold to Bear Stearns Cos. for $26 million, though the lender ended up paying Bear Stearns $7 million to close the deal to cover loans that had gone bad.
