By Dean Seal

Rocket Cos. is looking to take an even bigger chunk of the mortgage market with the $9.4 billion acquisition of Mr. Cooper Group, one of the country's largest servicers.

The owner of Rocket Mortgage said Monday that it would exchange 11 of its Rocket shares for each share of Mr. Cooper, giving the latter company's stock a deal value of $143.33 based on last week's closing prices.

Shares of Mr. Cooper jumped 20% to $126.58 in premarket trading, while Rocket shares slid 1% to $12.90.

The acquisition comes less than a month after Rocket agreed to buy Redfin in an all-stock deal that valued the real-estate brokerage at $1.75 billion.

The Detroit-based Rocket has said it is trying to create a one-stop shopping experience for homebuyers that connects real-estate agents, lenders, title companies and mortgage servicers.

By acquiring Mr. Cooper and its nearly 7 million clients, Rocket would bring its combined servicing book up to $2.1 trillion across almost 10 million clients, the company said.

Rocket called Mr. Cooper the largest mortgage servicing company in the U.S. Mr. Cooper became the largest subservicer at the end of 2024, according to industry research group Inside Mortgage Finance.

The transaction would immediately boost Rocket's adjusted earnings and generate $100 million in additional pre-tax revenue from both higher recapture rates and the attachment of Rocket's title, closing and appraisal services to Mr. Cooper's existing originations, Rocket said.

Rocket also said the tie-up should create $400 million in pre-tax cost savings as it streamlines the two companies' operations, corporate overheads and investments.

The deal is expected to close in the fourth quarter. Once the transaction closes, Rocket shareholders would own about 75% of the combined company and Mr. Cooper shareholders would own the rest.

Write to Dean Seal at dean.seal@wsj.com

(END) Dow Jones Newswires

March 31, 2025 08:26 ET (12:26 GMT)

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