WASHINGTON - A seven-member group of investors has agreed to buy the remnants of failed lender IndyMac Bank, a symbol of the housing boom and bust, for $13.9 billion, federal regulators said Friday.
IndyMac, which specialized in loans made with little down payment or proof of assets, was seized by the government in July after a run on the bank as the U.S. housing market collapsed.
The Federal Deposit Insurance Corp. said a holding company led by Steven Mnuchin, co-chief executive of private equity firm Dune Capital Management, agreed to buy IndyMac in a deal reached Wednesday and expected to close by early next month.
The investors have formed a partnership, called IMB Management Holdings LP, that includes Dell Inc. founder Michael Dell's investment firm, MSD Capital.
Once the deal closes, the investment group would pour $1.3 billion in new capital into IndyMac and continue to operate the Pasadena, Calif-based bank, the FDIC said.
'We have assembled a group of experienced private investors in financial services to acquire the former IndyMac and operate it under new management with extensive banking experience,' Mnuchin said in a statement.
Other investors in the partnership include five private equity firms or hedge funds: J.C. Flowers & Co.; Stone Point Capital; Paulson & Co.; a fund controlled by billionaire George Soros' Fund Management; and a fund controlled by Silar Advisors LP.
IndyMac has 33 bank branches in Southern California with about $6.5 billion in deposits, about half the company's total at the time of its failure. Other IndyMac assets include a $157.7 billion loan servicing business, which collects mortgages and distributes them to investors, and a reverse-mortgage company, known as Financial Freedom.