Detroit-based fintech platform Rocket Companies has announced the acquisition of Mr. Cooper Group Inc. in an all-stock transaction for $9.4 billion in equity value.
After the acquisition, Rocket’s combined servicing book will be worth a reported $2.1 trillion across nearly 10 million clients, or one in every six mortgages in America.
“Servicing is a critical pillar of homeownership–alongside home search and mortgage origination,” said Varun Krishna, Rocket CEO. “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 seven million clients.”
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, as Dan Gilbert will remain Chairman of Rocket Companies. The Board of Directors of the combined entity 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.
Founded in 1985, Rocket Companies’ fintech platform includes mortgage, real estate, title, and personal finance businesses: Rocket Mortgage, Rocket Homes, Rocket Close, Rocket Money, and Rocket Loans.
Mr. Cooper Group provides servicing, origination, and transaction-based services throughout the U.S. with operations under its primary brands, Mr. Cooper, Xome, and Rushmore Servicing.
The transaction was unanimously approved by the Boards of Directors of both Rocket and Mr. Cooper, and is expected to close in Q4 of 2025, subject to approval of Mr. Cooper shareholders and the satisfaction of other closing conditions, including customary regulatory approvals.
“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,” said Bray. “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. I am deeply grateful for the dedication of the Mr. Cooper team and look forward to our continued work as we lead our industry into the future of homeownership.”
Highlights of the Transaction
- Rocket Mortgage has ranked number one in J.D. Power’s Mortgage Servicer Satisfaction Study for 10 years and number one in mortgage origination 12 times, driving the company’s 83% recapture rate–triple the industry average. With a significantly larger servicing portfolio, Rocket is poised to sustain its industry-leading retention and recapture rates.
- Following the acquisition of Mr. Cooper, Rocket will gain understanding of nearly seven million additional clients and 150 million annual customer interactions.
- The combined company will attain a balanced business model and maintain stability in all market environments. Rocket 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.
- 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.
- Cooper shareholders will receive a fixed exchange ratio of 11.0 Rocket shares for each share of Mr. Cooper common stock—a $143.33 per share value based on the closing price as of March 28, 2025, and a premium of 35% over the volume weighted average price (VWAP) of Mr. Cooper’s common stock for the 30 days ending March 28, 2025.
- Upon completion of the transaction, Rocket shareholders will own approximately 75% of the combined company on a fully diluted basis pro forma for the Redfin transaction, while Mr. Cooper shareholders will own approximately 25%. 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 $2.00 per share of Mr. Cooper common stock.
Rocket Continues to Re-Shape the Industry Landscape
Rocket’s acquisition of Mr. Cooper comes just weeks after another major deal by the fintech platform, after Rocket agreed to purchase digital real estate brokerage Redfin in an all-stock transaction for a value $1.75 billion of equity value.
“Rocket and Redfin have a unified vision of a better way to buy and sell homes,” said Krishna. “Together, we will improve the experience by connecting traditionally disparate steps of the search and financing process with leading technology that removes friction, reduces costs and increases value to American homebuyers.”
Rocket expects the combined company to achieve more than $200 million in run-rate synergies by 2027, including approximately $140 million in cost synergies from rationalization of duplicative operations and other costs. In addition, Rocket expects more than $60 million in revenue synergies from pairing the company’s financing clients with Redfin real estate agents, and from driving clients working with Redfin agents to Rocket’s mortgage, title and servicing offerings. The transaction is expected to be accretive to Rocket Companies’ adjusted earnings per share by the end of 2026. Rocket Companies will maintain its strong balance sheet and conservative leverage profile upon close of the transaction.
