Dominion Completes Sale of $461 Million Loan Portfolio.Business Editors RICHMOND, Va.--(BUSINESS WIRE)--Feb. 27, 2001 Sale Is Latest in Ongoing Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. Divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). Dominion (NYSE NYSE See: New York Stock Exchange : D) announced today that it has completed the sale of $461 million in commercial loan commitments held by First Source Financial and First Dominion Capital, units of its Dominion Capital financial services subsidiary. "The loans were sold through a securitization Securitization The process of creating a financial instrument by combining other financial assets and then marketing them to investors. Notes: Mortgage backed securities are a perfect example of securitization. May also be spelled as "securitisation. to First Source Loan Obligations Insured Trust, a special purpose Delaware business trust. The trust financed the majority of the purchase by issuing notes to third party investors in the U.S., Europe and Asia. JPMorgan/Chase placed the bonds and MBIA MBIA Montana Building Industry Association MBIA Municipal Bond Insurance Association MBIA Michigan Boating Industries Association MBIA Municipal Bond Investors Assurance MBIA Massachusetts Brain Injury Association MBIA Maryland Business Incubation Association provided financial surety," Charles E. Coudriet, president of Dominion Capital and manager of the sale process, said. The portfolio includes 40 loans made to middle-market companies for expansion, acquisitions and recapitalization Recapitalization Restructuring a company's debt and equity mixture often with the aim of making a company's capital structure more stable. Notes: Companies often want to diversify their debt-to-equity ratio to improve liquidity. . Chicago-based First Source Financial originated 38 of the loans since being acquired by Dominion Capital in 1995. New York-based First Dominion Capital originated the remaining two since it was formed by Dominion Capital in 1997. Terms of the transaction were not disclosed. Thos. E. Capps, chairman, president and chief executive officer of Dominion, said: "Since last fall, we've sold more than $2 billion in loans from Dominion Capital's books. We continue to build on our commitment to divest non-core assets, de-leverage our balance sheet and focus our resources on the growing Midwest, Northeast and Mid-Atlantic gas and electric markets, home to 40 percent of the nation's demand for energy." Last fall, Dominion completed agreements to sell $948 million in commercial loan commitments to GE Capital Commercial Finance and $716 million in commercial loan commitments to First Source Loan Obligations Trust. To date, Dominion has announced or closed the divestiture of about 90 percent of First Source Financial assets Financial assets Claims on real assets. and about 30 percent of First Dominion Capital and is actively working to divest the remaining assets. Through the ongoing divestiture of Dominion Capital and other asset divestitures, Dominion expects to raise a total of more than $1.5 billion in net cash proceeds. Dominion, headquartered in Richmond, Va., is one of the nation's largest producers of energy. For more information about Dominion, visit the company's web site at www.dom.com. |
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