H&R Block seeks to modify deal with Cerberus regarding sale of Option One

By Lisa Kerner

Charlotte, N.C., Aug. 30 - H&R Block, Inc. is in discussions with Cerberus Capital Management, LP to modify the companies' April agreement for H&R Block to sell its Option One Mortgage Corp. to Cerberus since some closing conditions are not being met.

Key components of the discussions include:

• Waiving the condition requiring Option One to have $2 billion in loans funded within 60 days of closing;

• Waiving the condition that Option One have a minimum of $8 billion in warehouse lines;

• H&R taking responsibility for divesting or winding down Option One's remaining origination business;

• Cerberus' purchase of Option One's loan servicing platform; and

• Advancing the Dec. 31 contract termination date to provide for an earlier resolution of the Option One situation.

The existing agreement remains in effect if and until the companies reach a new agreement. H&R Block said there can be no assurance any transaction will close, according to a company news release.

H&R Block is a provider of tax, financial, accounting and business consulting services and products based in Kansas City, Mo.

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