Western Alliance Bank has reached a definitive agreement to acquire AmeriHome Mortgage Company, the country’s third largest correspondent lender, for a purchase price of $1 billion in cash.
Specifically, Western Alliance reached a deal to buy AmeriHome’s parent company, Aris Mortgage Holding Company, LLC. The purchase price, according to a statement from the two companies, is subject to adjustments at closing.
Based in Thousand Oaks, California, AmeriHome purchased some $65 billion in originations in 2020 and, as of Dec. 31, managed a $99 billion servicing portfolio. The addition of AmeriHome adds a national mortgage franchise to Western Alliance’s umbrella and complements the bank’s national commercial ventures.
“We look forward to maximizing the strategic and financial opportunities created by partnering with AmeriHome, which has been a valued client of Western Alliance Bank for years,” said Ken Vecchione, president and CEO of Western Alliance. “Acquiring this differentiated, high-performing mortgage platform provides a powerful growth engine and expands mortgage offerings to existing clients that give us flexible levers to drive consistent returns throughout market cycles. … This move meaningfully enhances our [earnings per share] baseline and growth, diversifies our revenue mix, and mitigates business cycle volatility with a firm that augments our commercial-focused portfolio.”
After the transaction closes, AmeriHome will become a subsidiary of Western Alliance and continue to operate under its current brand, with the additional label of “a Western Alliance Bank company.” Jim Furash, president and CEO of AmeriHome, will continue to lead the firm.
“Joining Western Alliance Bank is a terrific opportunity to accelerate our own strategic objectives and pathway to growth, with an outstanding partner we know very well,” said Furash. “AmeriHome’s successful results and unique business model proved to be highly attractive for Western Alliance Bank, which has a history of growing by adding specialized financing groups that excel through differentiated B2B expertise and strong client service. It’s a great match.”
The acquisition is expected to close in the second quarter. To support the transaction, Western Alliance intends to raise approximately $275 million in primary capital through a registered public offering of common stock.
