COOP - Mr. Cooper stock rises after agreeing to sell title business for $500M

Mr. Cooper (COOP) stock gains 3.4% in premarket trading after agreeing to sell its Title365 title business to Blend Labs for $500M."This decision allows Mr. Cooper Group to focus on the growth and profitability potential within our core business of servicing and originations," said Mr. Cooper Chairman and CEO Jay Bray.The price consists of $450M in cash and a retained interest of 9.9%.Mr. Cooper Group expects to record an after-tax gain of ~$350M  and receive cash proceeds net of transaction costs and cash taxes of ~$400 million upon closing.Title365 will retain all cash it generates between March 15  and close, which is expected to occur in Q2 2021, for the benefit of the acquirer. Therefore, Title365's cash generated during that time isn't expected to contribute to Mr. Cooper's Q2 earnings.The transaction will add to COOP's liquidity and tangible book value, said the company's CFO and vice chairman, Chris Marshall.

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Mr. Cooper stock rises after agreeing to sell title business for $500M