Quicken Loans to go public

Quicken Loans plans to list on the stock exchange, challenging high-street lenders.

CNBC’s Leslie Picker reported the news:

Quicken Loans, the largest mortgage lender in America, is planning an initial public offering, according to people familiar with the matter. 

The company, founded and owned by Detroit-billionaire Dan Gilbert, has filed its IPO prospectus confidentially, the people said, and may flip it to be public as soon as next month. 

Quicken Loans is working with Morgan Stanley, Goldman Sachs, Credit Suisse and JPMorgan to manage the deal, said the people, who asked not to be named discussing private information. The targeted valuation is still being decided, but it is likely in the tens of billions of dollars, one of the people said. That would imply a multi-billion-dollar IPO, one of the largest – if not the largest – this year. 

Richard Henderson, James Fontanella-Khan, and Eric Pratt from the FT wrote:

A public listing would mark a milestone for Dan Gilbert, the group’s founder, a billionaire who owns the Cleveland Cavaliers basketball team and has poured billions of dollars into projects to revitalise Detroit, the largest city in Michigan.

Quicken has emerged as the top challenger to traditional lenders, becoming the largest mortgage originator ahead of Wells Fargo in 2018, with more than $80bn in new loans. Last year the company closed nearly $145bn in mortgages.

Breana Noble and Jordyn Grzelewski from the Detroit News noted:

Quicken closed $145 billion in loans last year. It also posted a record $52 billion loan volume in the first quarter, and results were pending strong in April and May, despite a sharp economic downturn spurred by the novel coronavirus pandemic, executives told The Detroit News last month.

For a capital-intensive industry like mortgage lending, a public offering can pay off handsomely for shareholders and allow a company like Quicken to grow its business more broadly than it has in the past, said Rick Sharga, a mortgage industry veteran and CEO of California-based CJ Patrick Co., a real-estate consulting firm.