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PHH receives $50 mln after deal falls through
NEW YORK (Reuters) - Mortgage and vehicle fleet company PHH Corp (PHH.N) said on Friday it received a $50 million termination fee from Blackstone Capital Partners, a fund affiliated with buyout firm Blackstone Group (BX.N), after a deal to buy the company fell apart.
PHH said on Tuesday it terminated its nearly $2 billion sale to General Electric Co (GE.N) and Blackstone, after the private equity firm failed to obtain required financing for the deal. PHH said at the time it requested a termination fee of $50 million from the Blackstone Group.
PHH also said on Friday it agreed to pay up to $4.5 million to cover fees charged by consultants that Blackstone retained in connection with the failed deal.
GE and the Blackstone Group had agreed in March to acquire PHH for $1.8 billion. Under the terms, GE would have retained PHH's vehicle fleet company PHH Arval and would have sold PHH Mortgage to Blackstone.
PHH shares closed on Friday at $15.98, down 87 cents on the New York Stock Exchange. In March, the GE and Blackstone deal valued the company at $31.50 per share, and PHH stock had traded as high as $31.52 in July.
The deal termination follows turmoil in the credit markets, which has made financing of leveraged buyouts (LBOs) much more difficult.
(Reporting by Megan Davies; editing by Carol Bishopric)
