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From SA: New Residential nears deal with Ocwen; OCN up nearly 10% premarket
May 1, 2017 8:24 AM ET|About: New Residential Investme... (NRZ)|By: Stephen Alpher, SA News Editor

Details are somewhat sketchy as New Residential (NYSE:NRZ) management went through the points quite quickly on the earnings call, but NRZ will pay Ocwen (NYSE:OCN) $425M for at least some MSRs. Alongside, Ocwen will be hired as subservicer for a period of about 5 years.

NRZ will also purchase 4.9% of Ocwen's common stock - roughly $13.9M as of Friday's close.

Ocwen +9.6% premarket

Previously: New Residential investors look to earnings call for Ocwen discussion (May 1)

Update at 8:32 ET: NRZ is paying $425M for the servicing rights on which it already owns the excess. It's then turning around and hiring Ocwen to do the servicing. As for returns, NRZ management expects this transaction to be consistent with the mid-teens returns it seeks on any other deal. Ocwen now higher by 22.7% premarket.