Thornburg Mortgage bailout up in the air
NEW YORK (Reuters) - Thornburg Mortgage Inc TMA.N said on Tuesday the fate of its rescue package remains uncertain because the specialist in jumbo home loans has failed to resolve a dispute with its own lenders.
The Santa Fe, Mexico-based company said it extended an exchange offer for some preferred stock by three days to Sept 26. It said this would give it more time to negotiate with lenders that made a series of surprise margin calls and withheld some funds from the company after the offer began.
Until the dispute is resolved, Thornburg cannot complete a $1.35 billion bailout that it lined up in March from MatlinPatterson Global Advisors LLC and other investors following other margin calls, keeping it out of bankruptcy.
Larry Goldstone, Thornburg's chief executive, last month said Thornburg may fail if the rescue package falls apart.
Thornburg specialized in mortgages above $417,000 to borrowers with good credit, but ran short of capital as investors stopped buying its loans. The company ended June with $27.2 billion of adjustable-rate mortgage assets on its books.
Well over 100 mortgage lenders have stopped lending, been sold or gone bankrupt since the start of 2007.
The exchange offer calls for preferred stock investors to tender their shares, valued at $25 each, for $5 in cash plus 3.5 common shares. Thornburg has extended the exchange offer six times.
Thornburg shares closed Monday at 37 cents, New York Stock Exchange data show. Their 52-week high is $14.05, set on Feb 7. Thornburg's Class C preferred shares traded late Monday at $1.30, NYSE data show.
(Reporting by Jonathan Stempel; Editing by Derek Caney )
