CFIM is a unique turn-around situation, having emerged from bankruptcy and produced profitability within the last year.
After extensive due diligence, we have determined that CFIM meets and exceeds our criteria as an emerging growth Company, which we are proud to represent," said Richard C.
Williams, stated, "This quarter represents more than the fact that it was the first profitable quarter since taking over the reigns at CFIM in July 1999.
CFIM is currently structured around two lending divisions, the conforming retail lender, BDMC and Direct Mortgage Partners (DMP), a wholesale sub-prime lender.
In analyzing the results of operations, management had determined that sub-prime lending operations provide CFIM with the maximum profitability potential, and so the company will shift its focus exclusively to sub-prime lending.
Christopher Castoro, CFIM chief executive officer, said, "The transaction as structured will provide CFIM with the opportunity to sell its interest in BDMC at an attractive premium to book value and allow CFIM to focus its efforts on its sub-prime lending operations and development of a credible Internet-based loan application delivery mechanism.
The sale of BDMC will allow CFIM to devote its efforts exclusively to expanding its sub-prime lending division, development of a sub-prime loan servicing operation and completion of its e-commerce loan delivery capability.
Upon completion of the transaction, CFIM and BDMC will enter into a strategic alliance arrangement whereby sub-prime loans generated though BDMC's retail operations will continue to be sold though DMP investor channels.