Deutsche Bank to Acquire MortgageIT Holdings, Inc.
July 12 2006 - 8:49AM
Business Wire
Deutsche Bank (XETRA: DBKGn.DE / NYSE: DB) announced today the
signing of a definitive agreement to acquire MortgageIT Holdings,
Inc. (NYSE: MHL), a residential mortgage real estate investment
trust (REIT), for $14.75 in cash per share of common stock, or an
estimated $429 million (EUR 338 million) in the aggregate. The
transaction is expected to close in the fourth quarter of 2006,
subject to various closing conditions including MortgageIT
Holdings' shareholders' approval and customary regulatory
approvals. This acquisition is expected to be earnings accretive in
2007 and will add significant platform scale and synergies to
Deutsche Bank's existing US residential mortgage franchise. It is a
key element of the Bank's build-out of a vertically integrated
mortgage origination and securitization platform. MortgageIT
Holdings owns MortgageIT, Inc., a residential mortgage lender that
employs approximately 2,100 people in 50 branches, and is licensed
to originate residential mortgage loans in all 50 states. In 2005,
MortgageIT grew its loan originations approximately 124% over 2004,
to $29.2 billion, and is one of the fastest-growing and largest
residential mortgage loan originators in the US. Upon closing, the
operating company, MortgageIT, Inc., will become a part of Deutsche
Bank's Residential Mortgage Backed Securities (RMBS) business,
which is based in New York. Deutsche Bank's acquisition of
MortgageIT is the latest in a series of steps taken to
significantly increase its presence in the US mortgage markets. The
Bank has built a correspondent lending business which is on track
to purchase approximately $10 billion in residential mortgage loans
this year. In May, Deutsche Bank entered into a definitive
agreement to purchase Chapel Funding LLC, a sub-prime wholesale
mortgage originator which is expected to originate approximately $2
billion in mortgages in 2006. "As Deutsche Bank continues to grow
its RMBS business, we believe the vertical integration of a leading
mortgage originator like MortgageIT will provide significant
competitive advantages, such as access to a steady source of
product for distribution into the mortgage capital markets," said
Phil Weingord, Head of Global Markets for the Americas. "MortgageIT
is a significant lender in the prime Alt-A residential mortgage
sector. Uniting their business with our other channels of mortgage
loan origination coupled with our trading, structuring and
distribution capabilities will further advance our position as a
leading RMBS player." "The MortgageIT team has built an outstanding
business, and we are extremely pleased to have them join our effort
as we continue to expand our mortgage securitization platform in
the US and globally," said Anshu Jain, Head of Global Markets and
Member of the Deutsche Bank Group Executive Committee. "We believe
there is a tremendous opportunity to provide additional products
and services to clients in the US mortgage market. Together with
our new colleagues from MortgageIT, we look forward to driving the
market's evolution." "Our company has been an outstanding growth
story in residential mortgage lending in recent years. Partnering
our industry-leading team with the institutional capital markets
expertise and backing of a world-class financial institution like
Deutsche Bank is a perfect marriage", said Doug Naidus, Chairman
and Chief Executive Officer of MortgageIT. "This transaction will
enable us to accomplish our mutual goal of becoming a top player in
the US residential lending and securitization markets in short
order". About Deutsche Bank Deutsche Bank is a leading global
investment bank with a strong and profitable private clients
franchise. A leader in Germany and Europe, the bank is continuously
growing in North America, Asia and key emerging markets. With Euro
1,035 billion in assets and 64,103 employees, Deutsche Bank offers
unparalleled financial services in 73 countries throughout the
world. The bank competes to be the leading global provider of
financial solutions for demanding clients creating exceptional
value for its shareholders and people. www.db.com About MortgageIT
Holdings, Inc. MortgageIT Holdings, Inc. (NYSE: MHL) is a
self-administered mortgage real estate investment trust ("REIT")
focused on the residential lending market. The Company
self-originates its investment portfolio of high quality adjustable
rate mortgage ("ARM") loans through MortgageIT, Inc., its wholly
owned residential mortgage banking subsidiary. MortgageIT, Inc. is
a full- service residential mortgage banking company that is
licensed to originate loans throughout the United States.
MortgageIT Holdings is organized and conducts its operations to
qualify as a REIT for federal income tax purposes. MortgageIT is
organized and operates as MortgageIT Holdings' taxable REIT
subsidiary. For more information, please visit
http://www.mortgageitholdings.com. This Release contains
forward-looking statements. Forward-looking statements are
statements that are not historical facts; they include statements
about Deutsche Bank's and MortgageIT Holdings' beliefs and
expectations. Any statement in this Release that states Deutsche
Bank's or MortgageIT Holdings' intentions, beliefs, expectations or
predictions (and the assumptions underlying them) is a
forward-looking statement. These statements are based on plans,
estimates and projections as they are currently available to the
management of Deutsche Bank or MortgageIT Holdings, as applicable.
Forward-looking statements therefore speak only as of the date they
are made, and neither Deutsche Bank nor MortgageIT Holdings
undertakes any obligation to update publicly any of them in light
of new information or future events. By their very nature,
forward-looking statements involve risks and uncertainties. A
number of important factors could therefore cause actual results to
differ materially from those contained in any forward-looking
statement. Such factors include: the conditions in the financial
markets in Germany (in the case of Deutsche Bank), in Europe (in
the case of Deutsche Bank), in the United States and elsewhere from
which Deutsche Bank and MortgageIT Holdings derive a substantial
portion of their respective revenues; potential defaults of
borrowers or trading counterparties; the implementation of their
respective management agendas; the reliability of their respective
risk management policies, procedures and methods; and other risks
referenced in their respective filings with SEC. With respect to
Deutsche Bank, such factors are described in detail in its SEC Form
20-F filed on 23 March 2006, on pages 7 through 13 under the
heading "Risk Factors." Copies of this document are readily
available upon request or can be downloaded from
www.deutsche-bank.com/ir. With respect to MortgageIT Holdings,
Inc., such factors are described in detail in its SEC Form 10-K,
filed on March 15, 2006, on pages 11 through 29 under the heading
"Risk Factors." Copies of this document are readily available upon
request or can be downloaded from www.mortageitholdings.com or
www.sec.gov. Notice to MortgageIT Investors MortgageIT Holdings
intends to file a proxy statement in connection with the proposed
merger. MortgageIT Holdings investors and security holders should
read the proxy statement and other relevant materials when they
become available, because they will contain important information
about MortgageIT Holdings and the proposed merger. In addition to
the documents described above, MortgageIT Holdings files annual,
quarterly and current reports, proxy statements and other
information with the U.S. Securities and Exchange Commission (the
"SEC"). The proxy statement and other relevant materials (when they
become available), and any other documents filed with the SEC by
MortgageIT Holdings are available without charge at the SEC's
website, at www.sec.gov, or from the MortgageIT Holdings' website
at www.mortgageitholdings.com, under the heading Financial Reports
- SEC Filings. MortgageIT Holdings and its directors and executive
officers may be deemed to be participants in the solicitation of
proxies from MortgageIT Holdings stockholders in connection with
the proposed merger. A description of certain interests of the
directors and executive officers of MortgageIT Holdings is set
forth in the MortgageIT Holdings proxy statement for its 2006
annual meeting which was filed with the SEC on April 28, 2006.
Additional information regarding the interests of such potential
participants will be included in the definitive proxy statement and
other relevant documents to be filed with the SEC in connection
with the proposed merger.
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