Houlihan Lokey Advises AmeriHome Mortgage Company

Houlihan Lokey is pleased to announce that Apollo Global Management (NYSE:APO) and Athene Holding Ltd. (NYSE:ATH) have sold AmeriHome Mortgage Company (AmeriHome) to Western Alliance Bancorporation (NYSE:WAL) for approximately $1.0 billion in cash. The transaction closed on April 7, 2021.

Founded in 2013, and based in Thousand Oaks, California, AmeriHome is a leading U.S. residential mortgage producer and servicer. The firm operates three complementary business segments: correspondent, consumer direct, and servicing. It ranked as the third largest correspondent producer of mortgages and the 13th largest producer of mortgages overall in the U.S. during 2020. AmeriHome has a track record of consistent, prudent, and profitable growth, having expanded its production volume from $19 billion in 2015 to $65 billion for the 12 months ended December 31, 2020, and expanded its servicing portfolio from $19 billion to $99 billion as of December 31, 2020.

With more than $35 billion in assets and an equity market capitalization of approximately $8 billion, Western Alliance is one of the country’s top-performing banks. The company was the No. 1 best-performing of the 50 largest public U.S. banks in the most recent S&P Global Market Intelligence listing and ranks high on Forbes' “Best Banks in America” list year after year. Its primary subsidiary, Western Alliance Bank, Member FDIC, helps business clients realize their ambitions with teams of experienced bankers who deliver superior service and a full spectrum of traditional banking products, along with specialized financial products and solutions across many industries and sectors.

The acquisition is strategic for Western Alliance, as the addition of AmeriHome extends its national commercial businesses with a complementary, low-risk national mortgage franchise. AmeriHome’s combination of business model, diversified and complementary channels, and sophisticated portfolio management strategies has successfully generated consistent and profitable returns throughout rate environments and economic cycles. The transaction also markedly increases the contribution from non-interest income sources for the bank. From a financial perspective, the transaction is estimated to produce accretion of more than 30% to 2022 EPS and more than 500 basis points to return on average tangible common equity.

Under the terms of the agreement, AmeriHome will become a subsidiary of Western Alliance Bank. Western Alliance will pay cash consideration of $275 million plus adjusted tangible book value at closing for an estimated aggregate consideration of $1.0 billion (based on AmeriHome’s December 31, 2020 results). Post-closing, AmeriHome will operate under its current brand, AmeriHome, a Western Alliance Bank company, and will continue to be led by Jim Furash, its current President and Chief Executive Officer.

Houlihan Lokey served as financial advisor to AmeriHome and assisted in marketing, structuring, and negotiating the transaction.