Altisource Portfolio Solutions announced Monday that it is exiting its home buying business.
According to the company, Altisource plans to discontinue its “Buy-Renovate-Lease-Sell” business, which focuses on buying, renovating, leasing, and selling single-family homes to real estate investors.
Additionally, the company said it will be selling off its short-term investments in real estate, which currently total approximately $51.7 million.
According to the company, the home buying business generated $20.3 million of service revenue in the first three quarters of 2018.
But now, the company plans to exit the business and sell off its existing inventory of homes.
According to the company, it plans to use the majority of the proceeds of the home sales, which it expects to receive in the fourth quarter of 2018 and the first quarter of 2019, to pay down $50 million of its corporate debt.
The company also said Monday that it plans to buy back some of its shares under a repurchase plan to allow the company to buy as much as $400,000 in company stock per trading day.
According to the company, so far in the fourth quarter, it has bought back 373,750 shares.
Altisource CEO William Shepro said the moves are part of the company’s efforts to “streamline” its operations and focus on larger opportunities.
“With the recent sale of the Rental Property Management business to Front Yard Residential Corp. and (Front Yard’s) sale of most of its REO and non-performing loans, we believe it is the right time to exit this smaller operation and use the capital invested in BRS Inventory to reduce our debt,” Shepro said. “Further, given where Altisource’s shares are trading, we believe repurchasing shares represents an attractive use of capital.”
