Return to search

Blackstone, TPG to buy former Lehman mortgage unit

The two private equity firms have combined to buy UK company, Acenden Mortgage Servicing Solutions, formerly known as Capstone.

The Blackstone Group and TPG Capital have joined forces again in the UK, this time agreeing to buy mortgage servicing solutions company, Acenden Mortgage Servicing Solutions, formerly known as Capstone.

Blackstone and TPG said an agreement had been reached to buy the business from the administrators of Lehman Brothers in a move that provides the pair with a platform of more than 64,000 loans with a value of £5.4 billion (€6.9 billion; $8.1 billion) and employing nearly 400 staff.

It has been acquired on behalf of Blackstone’s Tactical Opportunities business and TPG’s Special Situations Solutions (TSSP) group – the same duo that in September last year teamed to buy UK sub-prime mortgage lender Kensington for £180 million from Investec. In that instance, Blackstone and TPG Capital said they would be injecting capital into the acquired business to allow for expansion of Kensington's specialist lending to self-employed homebuyers and landlords.

Capstone was originally started in 2006 from the combination of the loan origination and servicing operations of Southern Pacific Mortgage and Preferred Mortgages, both subsidiaries of Lehman Brothers. In 2010, Capstone restructured, which allowed for senior management to take a minority financial stake in the company. One of those senior managers is chief executive officer, Amany Attia, who used to be responsible for all origination, trading and principal investment activities and all mortgage lending and servicing platforms for Lehman Brothers Europe.

In a statement today, Attia said: “We are excited to work with Blackstone and TSSP and believe that Acenden is well placed to benefit in the long term from the collaboration with our new shareholders.”
Press reports first surfaced in March 2014 that Acenden was up for sale, and that the administrator for Lehman Brothers owned 75 percent, and also that the management team saw a future for the business once under a new ownership structure.

The transaction is not the only one announced this week that involved private equity groups acquiring a mortgage advisory firm. On January 6, Situs said it was to be sold to private equity firm, Stone Point Capital. In its time, Situs has evaluated over $1 trillion in commercial real estate, resolved more than $50 billion in distressed assets, and has over $100 billion of assets under management in North America, Europe, and Asia. A controlling stake in it is being sold by Ranieri Partners and WL Ross & Co.