Walter Investment Buying Green Tree In $1.07B Deal

TAMPA, Fla. (AP) -- Walter Investment Management Corp. is buying Green Tree Credit Solutions in a deal worth approximately $1.07 billion.

Green Tree, which is based in St. Paul, Minn., and formally known as GTCS Holdings LLC, is a fee-based company that provides third-party servicing of credit-sensitive consumer loans.

"We believe that with the acquisition of Green Tree, Walter Investment will be uniquely positioned to capture a significant share of the growing specialty mortgage services sector," Walter Investment Chairman and CEO Mark J. O'Brien said in a statement.

Walter Investment also said Monday that the transaction will give it a higher concentration of recurring, fee-based revenue.

Walter Investment is a mortgage servicer and mortgage portfolio owner specializing in less-than-prime and other credit-sensitive mortgage assets. Walter, which has annual revenue of about $180 million and employs about 340 people, is structured as a real estate investment trust.

Walter Investment will no longer qualify as a real estate investment trust as a result of the deal.

Walter Investment will take on about $20 million of Green Tree's existing debt and will issue about 1.8 million of its shares to the company. About $765 million of new debt has been committed by Credit Suisse and Royal Bank of Scotland PLC for the acquisition. Walter Investment will also use an unspecified amount of cash to fund the buyout.

Walter Investment's board unanimously approved the acquisition, which is expected to close early in the third quarter.

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