Wall Street Manna

An irreverent look at Wall Street

Tuesday, December 4, 2007

Cerberus ends Option-one deal

This is the anatomy of the mortgage mess.

  • It was originally offered at $1.3 billion.
  • Then it was valued at $1.1 billion
  • Cerberus was to pay $800 million; as $300 million was the valuation haircut on the the $1.1 billion.
  • Today, HRB closed Option One, laid off 620 employees, and took another $75 million charge.
  • The deal with Cerberus is off, and their still isn't a sale of the origination business.
  • The servicing business will have $125 million impairment.
  • And there's no break-up fee.

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