Industry players discuss possible new bidder for CFF

Brokers are discussing the good – and bad – of a REIT potentially swooping in with a competing bid for CFF Bank.

“I don’t know very much … other than my perspective is that it wouldn’t be a bad thing having two suitors as opposed to one,” Roy Singh of Centum Discount Mortgage and the operator of a CFF Centre told MortgageBrokerNews.ca. “That might cause Home Trust to sweeten their deal.”

CMT reported last week it has heard from multiple sources that another potential buyer is interested in CFF Bank, citing a number of anonymous industry sources.

According to that article, Westbridge REIT – a federally incorporated mortgage fund that focuses on construction financing, structured credit and mortgage trading -- is planning on making an offer to Canadian First Financial Group to acquire a controlling interest in CFF Bank. Westbridge is reportedly planning on maintaining the current 38 CFF Centres operated by mortgage brokers.

According to JD Diabira, chief executive officer of Westbridge, the company made an offer on Sunday and it is currently being reviewed by the CFF's shareholders.

"We're definitely in play and there is a lot of back-and-forth between the board and us; we aren't interested in a hostile takeover, so if management and the board aren't interested we aren't interested," he told MortgageBrokerNews.ca. "Our offer is far superior."

For his part, Eric Coching, who operates a CFF Centre in Victoria, B.C., is awaiting more facts. Though he is weary the deal could result in fewer products he can offer through his centre.

“It’s hard to answer (what this will mean) because we don’t know all the facts; there is always more to the story,” Coching of The Mortgage Centre told MortgageBrokerNews.ca. “Obviously we want what is best for the shareholders, but Home Trust would help us offer more products and we aren’t sure what (Westbridge) can offer.”

Home Capital announced earlier this month it had acquired CFF Bank. The deal is pending OSFI and shareholder approval. It was reported by CMT that the Home Capital acquisition approval vote was slated for last Thursday.

According to Diabira, that offer has been accepted.

"They have approved the Home Trust deal but it hasn't yet closed," he said. "The board still has a responsibility to review any superior offer."

Calls to CFF Bank and Home Capital have not yet been returned.

MBN