Blackstone Group LP acquired a “significant equity stake” in mortgage insurer PMI Group Inc.
Blackstone, the New York-based private-equity firm, will provide a loan to PMI for working capital and gains the right to take part in future equity offerings, according to a statement issued Wednesday. The buyout firm may also nominate a director to PMI’s board. Specific terms weren’t disclosed.
The insurer emerged from bankruptcy protection in 2013 after it was hobbled by real estate losses tied to the financial crisis. Arch Capital Group Ltd., a Bermuda-based insurer, snapped up some of PMI’s assets as signs that the housing market was improving boosted interest in the sector.
“Blackstone is well positioned to help the company achieve its strategic objectives and maximize value for all shareholders,” Blackstone Tactical Opportunities’ Naveen Bhatia said in the statement.
Peter J. Solomon Co. was financial adviser to PMI and Skadden, Arps, Slate, Meagher & Flom LLP was legal counsel. Blackstone Advisory Partners LP was financial adviser for Blackstone Tactical Opportunities, while Weil Gotshal & Manges LLP was legal counsel.
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