Rocket Cos. in Detroit today announced it has agreed to acquire Dallas-based Mr. Cooper Group Inc., the nation’s largest mortgage service company, in an all-stock transaction for $9.4 billion in equity value.
The acquisition, according to Rocket, will bring the company’s industry-leading mortgage recapture capabilities to a combined servicing book of $2.1 trillion across nearly 10 million clients, representing one in every six mortgages in America.
Ultimately, the combination drives higher loan volume and long-term client relationships while providing greater recurring revenue and lowering client acquisition costs, Rocket says.
Rocket says it will bring together the homeownership experience at scale with the acquisitions of Mr. Cooper, and more recently, Redfin. Moving forward, Rocket will accelerate its AI-powered platform and remove what it states are the friction and complexities plaguing today’s homebuying process.
“Servicing is a critical pillar of homeownership, alongside home search and mortgage origination,” says Varun Krishna, CEO of Rocket. “With the right data and AI infrastructure, we will deliver the right products at the right time. That’s how we build lifelong relationships, by proactively unlocking benefits and meeting needs before they arise. We look forward to welcoming Mr. Cooper’s nearly 7 million clients.”
Jay Bray, chairman and CEO of Mr. Cooper, says: “Mr. Cooper has been on a journey to transform the homeownership experience, and we have built the most advanced servicing platform in the mortgage industry. By combining Mr. Cooper and Rocket, we will form the strongest mortgage company in the industry, offering an end-to-end homeownership experience backed by leading technology and grounded in customer care.”
The benefits of the combined company include:
Scaled homeownership platform: Rocket’s combined servicing portfolio will exceed $2.1 trillion in unpaid principal balance — or one in every six mortgages in America.
Accelerate origination-servicing recapture flywheel: Rocket Mortgage has ranked No. 1 in J.D. Power’s mortgage servicer study for 10 years and No. 1 in mortgage origination 12 times, driving the company’s 83 percent recapture rate — triple the industry average. With a significantly larger servicing portfolio, Rocket says it’s poised to sustain its industry-leading retention and recapture rates.
Significantly increases data set to improve automation, personalization and efficiency: Following the acquisition of Mr. Cooper, Rocket says it will gain understanding of nearly 7 million additional clients and 150 million annual customer interactions.
Enhanced earnings growth opportunity across all interest rate market environments: The combined company will attain a balanced business model and maintain stability in all market environments. Rocket says it will drive earnings growth from high-margin recapture opportunities on the combined servicing portfolio, which together generated $4 billion of servicing fee revenue in 2024.
Substantial revenue and cost synergies: The transaction is expected to generate $100 million in additional pre-tax revenue from higher recapture rates and attaching Rocket’s title, closing and appraisal services to Mr. Cooper’s existing originations. Rocket projects $400 million in pre-tax cost savings from streamlining operations, corporate expense and technology investments.
Impact on earnings: The transaction is expected to be accretive to Rocket’s adjusted earnings per share immediately after closing.
The combined company will be led by an experienced board and leadership team that leverages the strengths and capabilities of both companies. Upon closing of the transaction, it is expected that Mr. Cooper Group’s chairman and CEO Jay Bray will become president and CEO of Rocket Mortgage, reporting to Krishna. Dan Gilbert will remain chairman of Rocket Cos.
Upon closing, the board of the combined company will consist of 11 members, nine of whom will be from the board of Rocket and two of whom will be from the board of Mr. Cooper.
Terms of the Transaction
Under the terms of the agreement, Mr. Cooper shareholders will receive a fixed exchange ratio of 11.0 Rocket shares for each share of Mr. Cooper common stock. This represents a $143.33 per share value based on the closing price as of March 28, 2025, and a premium of 35 percent over the volume weighted average price (VWAP) of Mr. Cooper’s common stock for the 30 days ending March 28. Upon completion of the transaction, Rocket shareholders will own approximately 75 percent of the combined company on a fully diluted basis pro forma for the Redfin transaction, while Mr. Cooper shareholders will own approximately 25 percent. The all-stock transaction is intended to be tax-free to Mr. Cooper shareholders.
In connection with the completion of the transaction, Mr. Cooper will declare and pay a dividend of $2 per share of Mr. Cooper common stock.
The transaction is expected to close in the fourth quarter of 2025, subject to approval of Mr. Cooper shareholders and the satisfaction of other closing conditions, including customary regulatory approvals.
For more information, visit https://www.rocketcompanies.com/.
