Former Washington Mutual emerges as WMI Holdings
March 20, 2012, 7:22 p.m. EDT
McClatchy/Tribune - MCT Information Services
SEATTLE _ Washington Mutual's final exit from bankruptcy, and transformation from a giant thrift to a small mortgage reinsurer, is complete.
The company, now known as WMI Holdings and headquartered in Seattle, said its reorganization plan became effective Monday. It will begin distributing some $7 billion to creditors, many of them hedge funds that bought WaMu's debt securities after the company declared bankruptcy in September 2008.
Common and preferred shareholders will own the bulk of WMI Holdings, whose initial business will be managing WaMu's old mortgage-reinsurance business as it runs down.
But the new company will have $75 million in cash and access to a $125 million credit line, which could enable it to acquire other businesses or build new ones.
WMI Holdings also inherits billions of tax losses from the old WaMu, which could make it an attractive acquisition target down the road.
Michael Willingham, one of WMI Holdings' new directors, said in a statement that the board would "begin exploring opportunities available to the company to enhance the value of the reorganized company's assets for the benefit of the company's new shareholders."
The old WaMu's stock, which had been trading on the Pink Sheets under the ticker symbol WAMUQ, has been cancelled.
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