Battle Heats Up for PHH Mortgage

MT. LAUREL, N.J. – Pennant Capital Management LLC, a private equity fund trying to scuttle the takeover of PHH Corp. and its credit union-leading mortgage operations, raised its stake in PHH to almost 9% as the vote to sell the company is approaching. The Chatham, N.J., investment firm opposes selling PHH to GE Capital, which would then sell PHH Mortgage to private equity giant Blackstone Group, saying a spin-off or sale of the mortgage operations would best benefit PHH shareholders. Despite the 13% premium offered by GE Capital, PHH shares have stayed mired around $26, or under the $31.50-a-share offer, indicating the market sees impediments to the GE Capital deal. PHH, already one of the leading mortgage banks for credit unions, acquired CUNA Mutual Group’s mortgage operations, which included relationships with more than 2,000 credit unions and a mortgage servicing portfolio of more than $13 billion.