Ann Arbor, Michigan-based Home Point Financial Corp. has completed its $211 million acquisition of Indianapolis-based Stonegate Mortgage Corp., the companies said Wednesday in public filings.
Stonegate, founded in 2005, has become a subsidiary of Home Point and is now operating under the Home Point name.
The acquisition was announced in January and approved by Stonegate’s board of directors in April. Stonegate stockholders received $8 each for their shares.
The sale marks the end of Stonegate’s stint as a public company, which has largely disappointed investors. Shares hovered above $18 each after the company's initial public offering in late 2013, but they went on a downward slide afterward, hitting a low of $3.28 a share in June 2016.
Stonegate’s shares, priced at $7.99 each, ceased trading on the New York Stock Exchange on Wednesday.
"The successful completion of this acquisition is an important milestone for us," Home Point CEO Willie Newman said in written comments. "Home Point will now have full coverage in all channels of origination, as well as warehouse lending offerings. In addition, the acquisition brings an in-house servicing platform to Home Point, giving us the ability to directly manage relationships with our customers. The most exciting part is combining the experience and talent of these two great companies in the service of our customers."
A number of Stonegate executives resigned from their positions just prior to the completion of the merger, including CEO and President Jim Smith, Chief Financial Officer Carrie Preston, Chief Information Officer Douglas Gilmore and Chief Risk Officer Kelly Henry.
Smith joined the merged company as chief operating officer.
Other Stonegate execs to leave the company included David Dill, executive vice president of loan servicing; David Kress, general counsel and secretary; Steve Landes, director of national sales; and John Macke, executive vice president of capital markets.
Smith, Richard Kraemer, Kevin Bhatt, James Brown, Sam Levinson, Richard Mirro and Scott Mumphrey stepped down as Stonegate board members.
The company said in a public filing that “none of these resignations were as a result of any disagreement with Stonegate, its management or its board of directors.”
Employment at Stonegate dropped from 869 as of March 31, 2016, to 796 as of March 31, 2017, the company said in its latest quarterly report. Fewer than 400 of those employees work in Indiana.
A spokesman for Home Point Financial did not immediately respond Thursday to a question about how the merger would affect Indianapolis operations.
Stonegate was founded Jim Cutillo, who earned a reputation as a blunt, hard-driving CEO, as a 2014 IBJ profile points out, and he also had a few run-ins with controversy.
The company struggled to meet or beat earnings estimates under Cutillo and, in September 2015, he abruptly resigned. The surprise departure prompted analyst speculation that the company might be preparing to put itself up for sale.