Finance of America Companies Launches Home Improvement Loan Vertical With Acquisition of Renovate America’s Benji Business
Finance of America Equity Capital LLC announced that its subsidiary, Finance of America Mortgage LLC (FAM), has won a court-supervised sale to acquire assets from Renovate America, including the Benji home financing product. This $45 million transaction is set to close by the end of March and will launch a new vertical, Finance of America Home Improvement. The acquisition positions Finance of America to tap into the $400 billion home renovation market, enhancing its consumer lending platform.
- Acquisition of Renovate America's Benji product enhances Finance of America's offerings.
- Entry into the $400 billion home renovation market presents significant growth opportunities.
- The new vertical, Finance of America Home Improvement, complements existing consumer lending services.
- Renovate America is undergoing Chapter 11 bankruptcy, indicating potential financial instability.
- Integration challenges may arise from combining operations and teams post-acquisition.
Finance of America Equity Capital LLC (“Finance of America” or the “Company”) an end-to-end lending and services platform, today announced that its subsidiary, Finance of America Mortgage LLC (“FAM”), has emerged as the winner in a court-supervised sale process to acquire certain of the assets of Renovate America, Inc., including its industry-leading home financing product, Benji®. The transaction is subject to customary closing conditions and is expected to close at the end of March.
The closing of the transaction will mark the launch of a new vertical, Finance of America Home Improvement, which strongly complements Finance of America’s diversified consumer lending platform consisting of mortgages, reverse mortgages, and commercial loans offered across distributed retail, third-party brokers and digital direct-to-consumer channels. Finance of America Home Improvement will enable the company to capitalize on the
“At Finance of America, we have a long track record of acquiring companies and products with businesses and core competencies that complement and bolster our own, and importantly, unlocking synergies as we integrate these onto our platform,” said Patricia Cook, CEO of Finance of America. “This transaction allows us to continue developing and growing Benji, Renovate America’s industry-leading home improvement financing product, and adds another innovative home financing solution to our comprehensive suite of consumer lending products. We look forward to welcoming the Benji team to the Finance of America family.”
In December, FAM entered into an asset purchase agreement with Renovate America in conjunction with a Bankruptcy Court-supervised auction. Renovate America voluntarily filed for Chapter 11 bankruptcy protection as part of a Section 363 sales process on the same day. FAM’s final cash offer of approximately
Shawn Stone, Renovate America’s CEO, added, “When we decided to embark on this process, we identified Finance of America as the ideal partner for our Benji business. We are very pleased that they have emerged as the winner and look forward to many positive developments for our contractors and employees in the future.”
Hunton Andrews Kurth LLP is acting as Finance of America’s legal advisor for the transaction.
About Finance of America Companies
Finance of America is a diversified, vertically integrated consumer lending platform. Product offerings include mortgages, reverse mortgages, and loans to residential real estate investors distributed across retail, third party network, and digital channels. In addition, Finance of America offers complementary lending services to enhance the customer experience, as well as capital markets and portfolio management capabilities to optimize distribution to investors. The Company is headquartered in Irving, TX, and is a portfolio company of the leading global asset manager, The Blackstone Group. On October 13, 2020, Finance of America entered into a business combination agreement with Replay Acquisition Corp. (NYSE: RPLA). Upon the closing of the transaction, the combined company intends to change its name to Finance of America Companies Inc. and trade on the NYSE under the ticker symbol “FOA.” www.financeofamerica.com
About Replay Acquisition Corp.
Founded by Edmond Safra, Gregorio Werthein and Gerardo Werthein, Replay Acquisition Corp. is a NYSE-listed blank check company incorporated as a Cayman Islands exempted company and formed for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses on industries that we believe have favorable prospects and a high likelihood of generating strong risk-adjusted returns for our shareholders. These industries include consumer, telecommunications and technology, energy, infrastructure, financial services and real estate, among others. www.replayacquisition.com
About Renovate America
Renovate America is one of the nation’s preeminent providers of home improvement financing through its industry-leading home financing product, Benji. The Company offers a proprietary technology platform that helps Americans improve their homes while giving contractors the tools they need to grow their business. In addition to offering intuitive financing options, Renovate America offers industry- leading education, training and mentoring to contractor teams in the field. For more information, visit www.renovateamerica.com.
Important Information About the Proposed Business Combination and Where to Find It
In connection with the proposed business combination, a registration statement on Form S-4 (the “Form S-4”) is expected to be filed by a newly-formed holding company (“New Pubco”) with the SEC that will include a proxy statement of Replay Acquisition that will also constitute a prospectus of New Pubco. Replay Acquisition’s shareholders and other interested persons are advised to read, when available, the Form S-4, including the preliminary proxy statement/prospectus and the amendments thereto and the definitive proxy statement/prospectus and documents incorporated by reference therein, as well as other documents filed with the SEC in connection with the proposed business combination, as these materials will contain important information about Finance of America, Replay Acquisition and the proposed business combination. Such persons can also read Replay Acquisition’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019, for a description of the security holdings of Replay Acquisition’s officers and directors and their respective interests as security holders in the consummation of the proposed business combination. When available, the definitive proxy statement/prospectus will be mailed to shareholders of Replay Acquisition as of a record date to be established for voting on the proposed business combination. Shareholders will also be able to obtain copies of such documents, without charge, once available, at the SEC’s website at www.sec.gov, or by directing a request to: Replay Acquisition Corp., 767 Fifth Avenue, 46th Floor, New York, New York 10153, or info@replayacquisition.com.
Participants in the Solicitation
Replay Acquisition, Finance of America, New Pubco and their respective directors, executive officers and other members of their management and employees, under SEC rules, may be deemed to be participants in the solicitation of proxies of Replay Acquisition’s shareholders in connection with the proposed business combination. Investors and security holders may obtain more detailed information regarding the names, affiliations and interests of Replay Acquisition’s directors and executive officers in Replay Acquisition’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019, which was filed with the SEC on March 25, 2020. Information regarding the persons who may, under SEC rules, be deemed participants in the solicitation of proxies of Replay Acquisition’s shareholders in connection with the proposed business combination will be set forth in the proxy statement/prospectus for the proposed business combination when available. Information concerning the interests of Replay Acquisition’s and Finance of America’s participants in the solicitation, which may, in some cases, be different than those of Replay Acquisition's and Finance of America’s equity holders generally, will be set forth in the proxy statement/prospectus relating to the proposed business combination when it becomes available.
Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Replay Acquisition’s and Finance of America’s actual results may differ from their expectations, estimates, and projections and, consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions (or the negative versions of such words or expressions) are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, Replay Acquisition’s and Finance of America’s expectations with respect to future performance and anticipated financial impacts of the proposed business combination, the satisfaction or waiver of the closing conditions to the proposed business combination, and the timing of the completion of the proposed business combination.
These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially, and potentially adversely, from those expressed or implied in the forward-looking statements. Most of these factors are outside Replay Acquisition’s and Finance of America’s control and are difficult to predict. Factors that may cause such differences include, but are not limited to: (1) the occurrence of any event, change, or other circumstances that could give rise to the termination of the definitive merger agreement (the “Agreement”); (2) the outcome of any legal proceedings that may be instituted against Replay Acquisition, New Pubco and/or Finance of America following the announcement of the Agreement and the transactions contemplated therein; (3) the inability to complete the proposed business combination, including due to failure to obtain approval of the shareholders of Replay Acquisition, certain regulatory approvals, or satisfy other conditions to closing in the Agreement; (4) the occurrence of any event, change, or other circumstance that could give rise to the termination of the Agreement or could otherwise cause the transaction to fail to close; (5) the impact of COVID-19 on Finance of America’s business and/or the ability of the parties to complete the proposed business combination; (6) the inability to obtain or maintain the listing of New Pubco’s shares of common stock on the NYSE following the proposed business combination; (7) the risk that the proposed business combination disrupts current plans and operations as a result of the announcement and consummation of the proposed business combination; (8) the ability to recognize the anticipated benefits of the proposed business combination, which may be affected by, among other things, competition, the ability of Finance of America to grow and manage growth profitably, and retain its key employees; (9) costs related to the proposed business combination; (10) changes in applicable laws or regulations; and (11) the possibility that Finance of America or Replay Acquisition may be adversely affected by other economic, business, and/or competitive factors. The foregoing list of factors is not exclusive. Additional information concerning certain of these and other risk factors is contained in Replay Acquisition’s most recent filings with the SEC and will be contained in the Form S-4, including the proxy statement/prospectus expected to be filed in connection with the proposed business combination. All subsequent written and oral forward-looking statements concerning Replay Acquisition, Finance of America or New Pubco, the transactions described herein or other matters and attributable to Replay Acquisition, Finance of America, New Pubco or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements above. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Each of Replay Acquisition, Finance of America and New Pubco expressly disclaims any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in their expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based, except as required by law.
No Offer or Solicitation
This press release is not a proxy statement or solicitation of a proxy, consent, or authorization with respect to any securities or in respect of the proposed business combination. This press release shall also not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any states or jurisdictions in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended, or an exemption therefrom.
1 Statista. Home improvement market size in the United States from 2008 to 2024. https://www.statista.com/statistics/239753/total-sales-of-home-improvement-retailers-in-the-us/
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