Research Desk Line-up: Credit Acceptance Post Earnings Coverage

LONDON, UK / ACCESSWIRE / August 14, 2017 / Pro-Trader Daily takes a look at the latest corporate events and news making the headlines for PHH Corp. (NYSE: PHH), following which we have published a free report that can be viewed by signing up at http://protraderdaily.com/optin/?symbol=PHH. The Company announced on August 11, 2017, that it would be purchasing its common stock for a total amount of up to $266 million in cash. The Company plans to follow a modified "Dutch auction" self-tender offer to purchase its shares. For immediate access to our complimentary reports, including today's coverage, register for free now at:

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Discover more of our free reports coverage from other companies within the Credit Services industry. Pro-TD has currently selected Credit Acceptance Corporation (NASDAQ: CACC) for due-diligence and potential coverage as the Company announced on July 31, 2017, its financial results for Q2 2017 which ended on June 30, 2017. Tune in to our site to register for a free membership, and be among the early birds that get our report on Credit Acceptance when we publish it.

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A Dutch Auction is a type of auction in which bids for stock offerings begin at high prices and decrease until the price at which the total offering can be sold is determined.

Details of the Tender Offer

Interested shareholders who wish to sell all or a portion of their shares of common stock of the Company have the following options:

  1. The price of the share is specified by the shareholder and should be in the range of minimum $13.45 per share to not exceeding $14.25 per share. The options price can increase in increments of $0.05 per share.
  2. In case shareholders have not specified any purchase price, the Company will purchase their shares as per the price fixed for the tender offer.

The purchase price determined by the Company will attract withholding taxes but not any interest.

PHH Corp.'s stock price at the close of trade on August 10, 2017, was $13.95 per share.

The Tender offer will end at 11:59 p.m., New York City time on September 08, 2017, subject to extension or withdrawal of offer by the Company. The Company will finalize the purchase price which will not be greater than $14.25 per share nor less than $13.45 per share. Several factors will be taken into consideration while finalizing the purchase price for the tender offer including the number of shares tendered, the prices specified by shareholders etc. Another major factor influencing the final price of the share would be the Company's ability to purchase the maximum number of shares for $266 million.

Conditions of the tender offer

All the shares that are purchased through the tender offer will be purchased at the same Purchase Price irrespective of the fact that tendered at a lower price. All tendered shares that are at or below the Purchase Price may not be purchased if Shares are properly tendered and not properly withdrawn at or below the Purchase Price having an aggregate purchase price greater than $266 million. The Company has indicated that it has retained the right to purchase an additional 2% of its shares without amending or extending the tender offer, as per the rules of the US Securities and Exchange Commission (SEC). This could increase the upper limit of the purchase limit of $266 million.

The tendered shares that are not purchased would be returned to the tendering stockholders immediately after the tender expiry date. Shareholders who have tendered shares but want to withdraw from the tender offer can do so at any time before the expiry date by following standard procedures.

The tender offer is not subject to either obtaining financing for the tender offer or any minimum number of shares being tendered. The detailed terms and conditions of the tender offer are spelled out in the Offer to Purchase, Letter of Transmittal, and other related documents filed with the SEC. If any condition specified in the Offer to Purchase is triggered, the Company may waive, at its discretion, such condition prior to the expiration of the tender offer to proceed with the tender offer.

The Company has received intimation from some of its long-standing directors that they plan to tender a part of their shareholding in the tender offer and in line with the Company's Non-Employee Director and Employee Share Ownership and Retention Policy. However, the Company's executive officers who also hold PHH Corp.'s shares have informed that they would not be tendering any shares in the current tender offer.

PHH Corp. has appointed Credit Suisse Securities (USA) LLC as the dealer manager, MacKenzie Partners, Inc. as information agent and Computershare Trust Company, NA as depositary for the tender offer.

Reasons for the Tender offer

The tender offer is a part of PHH Corp.'s business strategy which includes the capital return strategy for stockholders and restructuring initiatives. The aim is to gain clarity on the excess cash in hand available with the Company and make a financial decision that not only utilizes the excess cash in a prudent manner but also adds value for its shareholders. The Company feels that the tender offer will enable it to purchase its shares in a faster and efficient manner than via open market sources. The tender offer would offer shareholders savings in terms of costs of broker fees or commissions payable when participating in an open market purchase.

About PHH Corp.

Mount Laurel, New Jersey based PHH Corp. provides end-to-end mortgage services via its subsidiary, PHH Mortgage. PHH has grown into one of the largest non-bank originators, servicers and sub-servicers of residential mortgages in the US. PHH Corp. offers its mortgage services to wealth management firms, banks, credit unions, real estate Companies, relocation professionals, etc. The Company also offers home financing solutions to consumers directly. Some of the brands under which the Company provides its services include Axiom Financial, Coldwell Banker Home Loans, First Capital, Mortgage California, PHH Home Loans, Princeton Capital, Rocky Mountain Mortgage, and Sunbelt Lending Services.

Last Close Stock Review

On Friday, August 11, 2017, the stock closed the trading session at $14.02, slightly rising 0.50% from its previous closing price of $13.95. A total volume of 552.28 thousand shares have exchanged hands, which was higher than the 3-month average volume of 410.41 thousand shares. PHH Corp.'s stock price advanced 6.62% in the last three months. At Friday's closing price, the stock's net capitalization stands at $715.72 million.

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