When the sale of Weyerhaeuser Mortgage Co. closes on April 30, the company will have a new chief executive officer and a new name.
Scott McAfee, president and chief executive of Spring Mountain Group, will become CEO of the mortgage company, which will have a new name-WMC Mortgage.
Weyerhaeuser Corp., the paper and products company based in Federal Way, Wash., announced it was selling its mortgage unit to Spring Mountain and Apollo Advisors LP in February.
A source close to Weyerhaeuser said Donald Lange, the mortgage unit's chief executive, would remain with the parent company as head of its financial services division.
Mr. McAfee said plans call for the lender, which will remain based in Woodland Hills, Calif., to concentrate on originating and servicing loans for customers with poor credit histories.
Weyerhaeuser Mortgage's subprime division, Equity Services, originated $500 million in 1996 and is hoping to double volume this year, said Stephen M. Wright, the unit's president.
Industry observers said the new owners would make an even greater push into the B and C area. Several sources said it was likely that the company would sell its existing servicing portfolio and convert its systems to service subprime loans. Weyerhaeuser sold about half its portfolio last year and now services $4.4 billion.
But Mr. McAfee said the lender would not abandon the conforming loan market since it was "a great company with an established franchise that has the ability to dominate its niche markets." The company has strong relationships with home builders and realty agents.
Sources also said a public stock offering of WMC was likely. Apollo is run by Leon Black, former head of mergers and acquisitions at onetime junk- bond powerhouse Drexel Burnham Lambert. Several of Apollo's real estate investments have gone public.
At the Mortgage Bankers Association of America's chief financial officers conference in Orlando last week, one person quipped that venture capitalists like Mr. Black "normally don't get out of bed" unless they can find a way to make a relatively quick and substantial return on their investment.