Irvine’s New Century Financial Corp. has auctioned off its loan servicing business for $188 million, the bankrupt subprime lender said.
Carrington Capital Management LLC, a Greenwich, Conn.-based hedge fund, was the winning bidder for the unit, which was auctioned off Wednesday in New York.
The winning bid was 35% higher than Carrington’s original $133 million bid, made last month. A Delaware bankruptcy court still needs to approve the sale at a hearing set for next week.
“We believe the proposed sale to Carrington is the right and responsible action for us to take given the circumstances,” New Century chief executive Brad Morrice said in a statement.
Carrington was created by New Century insiders in 2004.
New Century failed to receive any bids for another part of its company,its mortgage loan origination business,earlier this month.
