Mortgage giant Rocket Companies (RKT) announced Monday that it is acquiring its top competitor, Mr. Cooper Group Inc., in an all-stock deal valued at $9.4 billion.
“By combining Mr. Cooper and Rocket, we will form the strongest mortgage company in the industry, offering an end-to-end homeownership experience backed by leading technology and grounded in customer care,” Jay Bray, Mr. Cooper Group Chairman and CEO, said in the press release.
Mr. Cooper (COOP) stock rose as much as 17% on the news. Rocket stock fell as much as 9%.
The deal announcement reveals that the merged company will manage a loan portfolio of $2.1 trillion and serve nearly 10 million clients. Mr. Cooper shareholders will receive 11 Rocket shares for every share of Mr. Cooper stock they hold, reflecting a 35% premium.
This acquisition expands Rocket’s presence in the mortgage-servicing market and streamlines the homebuying process by eliminating friction and complexity. Rocket has recently embraced artificial intelligence to optimize this process.
The deal comes just weeks after RKT revealed it’s set to acquire digital real estate powerhouse Redfin (RDFN) in a $1.75 billion all-stock deal.
After the deal, Mr. Cooper CEO Jay Bray will become president and CEO of Rocket Mortgage, reporting to Varun Krishna, while Dan Gilbert will remain chairman of Rocket Companies.