Title and real estate services company Stewart Information Services Corp., owned by SISCO Holdings, has entered into an agreement to acquire the mortgage services of property preservation provider Mortgage Contracting Services (MCS) for $330 million.
The transaction, announced Friday, expands Stewart’s suite of services in the property preservation arena, which supports default servicing, while providing MCS with additional capital to invest in other business lines.
The deal is expected to close before the end of the year and will be immediately accretive, Stewart said. The company plans to fund the transaction with available resources. The acquired division will continue operating as a standalone company.
“Property preservation services are critical and necessary for servicers as part of the mortgage lifecycle, and currently a service Stewart does not offer,” Stewart CEO Fred Eppinger said in a statement.
Founded in 1986, MCS is selling its property preservation, inspection and other asset management and maintenance operations. But it will continue to operate its MCS Commercial, MCS Residential and MCS Government Services divisions and brands.
Processes, operations and technology to support mortgage servicers and lenders will transition to Stewart. In recent years, MCS has expanded through acquisitions of preservation leaders MSI and Five Brothers Asset Management Solutions.
“Our mortgage services customers will continue to receive the exceptional services MCS has delivered for years under this new ownership,” Craig Torrance, CEO of MCS, said in a statement. “The remaining MCS businesses will continue to operate under the MCS brand and are well-poised for continued growth.”
The sale provides additional capital and flexibility for future growth at MCS, which is currently led by a group of investors including Littlejohn & Co., Lynstone Holdings and Neuberger Berman Alternatives Advisers. Andrew Nolan will remain president of residential and commercial operations for MCS, reporting to Torrance.
Troutman Pepper Locke served as outside counsel to Stewart. Macquarie Capital acted as exclusive financial advisor to MCS, and BakerHostetler served as its legal adviser.
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