Ditech Holding Corporation, parent company of Reverse Mortgage Solutions (RMS), has officially been deregistered from the New York Stock Exchange according to an 8-K filing the company made with the Securities and Exchange Commission (SEC) Wednesday.
“On May 15, 2019, Ditech Holding Corporation filed a Form 15 with the Securities and Exchange Commission to deregister its Common Stock, $ 0.01 par value per share,” the filing reads in part.
This filing also suspended a requirement for the company to make a series of different filings with the SEC in the future, the form said.
“The company’s obligations to file certain reports and forms with the SEC […] were immediately suspended. The company expects that deregistration will become effective 90 days after filing […]”
While Ditech’s securities can continue to be traded over the counter, the company, “can make no assurance that any broker will continue to make a market in the company’s securities,” the filing reads.
The NYSE’s listing standard that requires companies to maintain at least $ 15 million in average global market capitalization over a consecutive 30-day period.
Last month, it was revealed that a loophole in Ditech’s bankruptcy proceedings has invited scrutiny from both consumer advocacy groups and the Department of Justice. In the midst of the financial difficulties that Ditech is embroiled in, RMS seems to be relatively insulated from the larger problems of its parent company, at least from an operational perspective.
After the January closure of a Ditech facility in Minnesota, an RMS company spokesperson told RMD that operations related to reverse mortgages would be unaffected.
According to a February filing with the Securities and Exchange Commission, Ditech also secured financing from its debtor-in-possession (DIP) facilities, allowing some of its subsidiaries – including RMS – to gain access to portions of up to $ 1.9 billion in available financing.
This follows a continually unfolding odyssey of financial problems for Ditech. Although they experienced a jump in revenue after the delisting notice the company received in November, it did little to stem the tide of difficulties the company is facing.
Earlier in 2018, Ditech emerged from bankruptcy after having previously done business under the name Walter Investment Management Corporation. Walter acquired Reverse Mortgage Solutions in 2012, and in 2017, Walter decided to stop originating Home Equity Conversion Mortgages (HECMs). RMS then turned to servicing only, and closed its retail channel.
In January, Ditech stated that it elected not to make an approximately $ 9 million cash interest payment to its creditors in December 2018, putting the company at risk of default.
