United Wholesale Mortgage (UWM), a Pontiac, Michigan-based wholesale mortgage lender, has agreed to merge with Gores Holdings IV.
Gores Holdings IV is a publicly listed, $425m special purpose acquisition company sponsored by an affiliate of The Gores Group.
Through the merger, UWM will go public with its shares listed on NASDAQ.
With an equity value of approximately $16.1bn, the combined company will operate under the UWM name, once the transaction is completed.
Subject to customary closing conditions and regulatory approvals, the deal is expected to be closed in the fourth quarter of this year.
Established in 1986, UWM is considered as one of the largest wholesale mortgage originator in the country with nearly 7,000 team members.
According to UWM, its differentiated business model focuses exclusively on offering wholesale mortgage clients a enhanced service through proprietary technology.
The company’s technology is designed to allow its clients to process mortgage applications fast and provide lower rates than competitors.
In the new company, the current owners of UWM will hold about 94% of the stake
In addition to nearly $425m in cash held in Gores Holdings IV’s trust account, additional investors have committed to participate in the proposed business combination.
The investors will participate through a $500m private placement, led by Alec Gores, Chairman and CEO of The Gores Group.
After the deal is closed, the current owners of UWM will retain nearly 94% of stake in the combined company and it will be led by the UWM’s current president and CEO Mat Ishbia.
Alec Gores said: “We are pleased to partner with UWM in this milestone transaction. Mat and his team have built an impressive organization that is the market leader in wholesale lending and has a strong focus on culture and delivering quality service and offerings for its customers.
“As a public company, UWM will be well positioned given its significant competitive advantages and we look forward to working together to accelerate the next phase of growth and to drive value for all of our stakeholders.”
