PennyMac Surges After Omega’s Cooperman Discloses 22% Stake
PennyMac Financial Services Inc. (PFSI), the mortgage company founded by former Countrywide Financial Corp. executives, rose 9 percent after Omega Advisors Inc.’s Leon Cooperman disclosed his hedge funds control a 22 percent stake.
Cooperman’s entities bought 2.75 million Class A shares at $18 each of Moorpark, California-based PennyMac in the firm’s initial public offering this month, according to a regulatory filing today. Another 9,600 shares were purchased May 14 for $19.71. PennyMac rose $1.88 to $21.88, the biggest gain since its IPO, at 1:30 p.m. and traded for as much as $22.10.
PennyMac, founded in 2008 by former Countrywide Financial President Stanford L. Kurland, makes and services U.S. residential loans. Kurland left Countrywide in 2006,and Bank of America Corp. (BAC) bought the company in 2008 as losses from faulty mortgages drove it to the brink of failure.
Countrywide’s loans have been blamed for helping to cause the housing market bubble and costing Charlotte, North Carolina-based Bank of America more than $40 billion in refunds, legal costs and regulatory settlements.
Cooperman declined to comment on his purchases. Omega, founded in 1991 by Cooperman, had about $8.1 billion under management as of April 30. Before starting Omega, he spent 25 years at Goldman Sachs Group Inc., and was a general partner and chief executive officer of the asset-management division when he left the New York-based bank.