Battered high-loan-to-value lender FirstPlus Financial Group said Thursday that it has secured a long-sought cash infusion-at a price.

The company will undergo a massive restructuring, selling its non-core businesses and its servicing portfolio and eliminating about 50% of its work force, or 3,000 jobs.

In return, FirstPlus will get $130 million. It is also forming a joint venture with Superior Bank, the buyer of the servicing portfolio, to help it securitize loans.

Superior, a unit of Coast-to-Coast Financial Corp., Las Vegas, will buy FirstPlus' $6 billion servicing portfolio for $75 million. The two have formed a joint venture through which FirstPlus will securitize or sell the loans it originates.

In return, Superior will get warrants to buy about 40% of FirstPlus' outstanding stock at the Oct. 14 closing price of $4.625.

Coast-to-Coast is owned by the Pritzker family, owners of the Hyatt hotel chain, and by ADCO Financial, a New York-based entity controlled by the Dworman family, well-known real estate investors.

The transaction "enhances our ability to increase market share in this less competitive environment," said Daniel Phillips, FirstPlus' chief executive officer, in a written statement.

FirstPlus and other specialty lenders have suffered from a liquidity drought, as profits in the asset-backed securities market crumbled, creditors pulled loans, and equity investors shied away from the sector.

FirstPlus said it has secured a buyer for its conforming loan businesses, its United Kingdom operations, and its consumer finance business, which includes more than 140 branches.

It has eliminated its high-LTV wholesale operations and consolidated its Laguna Hills, Calif., direct mail operations with its Dallas retail operations. It also consolidated its Texas subprime operations, eliminated its subprime broker operations, and fired a number of corporate executives.

Investors have been eagerly awaiting a deal since FirstPlus put itself on the block in August, and the company's stock has plummeted since then on fears it would never find a buyer or partner. Thursday's news was viewed as positive, but observers said there is no guarantee that the company will remain solvent.

"The only conclusion anyone could draw is that the company won't be going bankrupt in the near term," said one hedge fund manager who asked not to be named.

FirstPlus stock gained more than $1 per share after the announcement, which came before the announcement of a Federal Reserve interest rate cut, and was trading at $5.125 by 2 p.m.

Superior, with $1.4 billion of assets, owns nonconforming lender Alliance Funding Corp., and is funded in part by deposits from seven branches in the Chicago area.

The purchase of FirstPlus' servicing rights brings Superior's servicing portfolio up to $10 billion, and furthers its goal to become a nationwide servicer of nonconforming loans, said Nelson Stephenson, chief executive of Superior.

The bank is looking for other nonconforming lenders to partner with, he said. "Now that we have made an investment and gotten to scale, we intend to market this servicing and securitization strategy as a way to regain credibility," he said.

Mr. Stephenson said Superior will service the FirstPlus portfolio at FirstPlus' Dallas site and will retain the 375 employees there.

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