* Nationstar eclipses Berkshire bid for lending unit
* Berkshire named opening bidder for loan portfolio
* Others bidders can still emerge in bankruptcy process
By Rick Rothacker
June 19 A judge on Tuesday approved Nationstar
Mortgage Holdings Inc as the opening bidder for
Residential Capital LLC's mortgage origination and servicing
business, beating out an offer from Warren Buffett's Berkshire
Berkshire will be the opening bidder for a ResCap loan
portfolio, eclipsing an initial offer by ResCap's parent
company, Ally Financial, a ResCap spokeswoman said after a U.S.
Bankruptcy Court hearing in New York.
ResCap, the mortgage unit of Ally Financial, the
former in-house financing arm of General Motors Co, filed
for bankruptcy last month with a plan to sell assets to
Nationstar and Ally for about $4 billion.
After Berkshire emerged as a bidder for the mortgage
business, Nationstar, a unit of Fortress Investment Group LLC
, increased its initial bid by $125 million to $2.45
billion, ResCap said. Berkshire bid $1.44 billion for the loan
portfolio, $50 million more than Ally, ResCap said.
ResCap spokeswoman Susan Fitzpatrick said the company was
encouraged that there was significant interest in the opening
bidding for its assets. Other potential buyers will be able to
bid as part of the Chapter 11 bankruptcy process.
ResCap filed for bankruptcy last month as it faced looming
bond payments and a possible loss of financing from its parent.
Ally is eager to shed mortgage liabilities that have left it
limping in the wake of the financial crisis. The auto lender is
74 percent-owned by the U.S. Treasury after a series of
Ally spokeswoman Gina Proia said its initial "stalking
horse" bid for Rescap's loan portfolio aimed to generate value
for ResCap's bankruptcy estates as part of a settlement that
gave Ally legal releases to claims over mortgage-backed
"We are pleased to have fulfilled Ally's role regarding
ResCap's legacy loan portfolio," Proia said.
Berkshire and Nationstar did not return calls seeking
Judge Martin Glenn said on Monday he would appoint an
independent examiner to investigate the bankruptcy of ResCap
, a move sought by Berkshire.
Berkshire has said that some pre-bankruptcy financial
transactions between ResCap and Ally were "potentially improper"
in calling for the examiner appointment.
In a bankruptcy, an examiner investigates allegations such
as dishonesty, fraud, incompetence and mismanagement. Judges
have previously appointed examiners in bankruptcy cases for
Lehman Brothers Holdings Inc and Dynegy Holdings, a unit Dynegy
Fitzpatrick, the ResCap spokeswoman, said the company hopes
the examiner's work can be "completed promptly."