Shareholder group opposes bid to take Ocwen private

By Lisa Kerner

Charlotte, N.C., Feb. 15 - Ocwen Financial Corp. investors led by Greenwood Investments, Inc. and Roark, Rearden and Hamot LLC intend to vote their collective 3 million shares against the "opportunistic and inappropriate" proposal by the company's chief executive officer, William C. Erbey, to take the company private, believing the proposal is unfair to non-participating shareholders.

On Jan. 14, Erbey and a group led by Oaktree Capital Management, LP and Angelo, Gordon & Co. proposed taking the company private for $7 cash per share.

Erbey indicated he would make a "significant investment" in the deal and would give Ocwen's senior management team the opportunity to participate as well, it was previously reported.

Financing would include equity from Erbey and from investment funds managed by the investor group as well as an additional $150 million of debt or other financing.

Greenwood and its affiliates reserved the right to take action to oppose the proposal, including the solicitation of proxies against the proposal and seeking to elect a slate of directors to the company's board.

"If the purpose of this management buyout was to bolster the balance sheet of the company with a capital infusion, there are alternatives to a 'going private' transaction that will preserve the future opportunities at Ocwen for its current shareholders," the investors wrote in a Feb. 13 letter to Ocwen's board of directors.

The letter, signed by Greenwood president Steven Tannenbaum and Roark, Rearden and Hamot managing member Seth Hamot, was included in a schedule 13D filing with the Securities and Exchange Commission.

In rejecting the proposal, Tannenbaum and Hamot said Ocwen has a strong business, promising opportunities and healthy balance sheet.

Ocwen is a West Palm Beach, Fla.-based business process outsourcing provider to the financial services industry, specializing in loan servicing, mortgage fulfillment and receivables management services.

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