SoftBank-backed mortgage lender Better rebounds after bleak debut

BOS Better Online Solutions

25/08/2023 13:30

Aug 25 (Reuters) - Shares in Better Home & Finance
Holding  BETR.O  clawed back some lost ground in premarket
trading on Friday, after the online mortgage lender plunged in a
dismal debut a day earlier following a merger with a blank-check
company.
    The company's shares climbed 22.6% to $1.41 in trading
before the bell on Friday. They had finished Thursday's session
down 93.4%.
    The stock was among the most active tickers on retail
investor-focused forum Stocktwits.com. 
    The company hit the headlines in December 2021 after it laid
off 900 employees via Zoom, and has since seen its profit dented
by high mortgage rates that have dampened demand for home loans.
    Better planned to go public via a $6 billion special-purpose
acquisition company (SPAC) merger with Aurora Acquisition Corp
in 2021, but delayed the deal amid a U.S. Securities and
Exchange Commission inquiry and multiple rounds of layoffs.
    "Here is an example of the exact wrong company at the wrong
time - SPACs are hated and anything related to mortgage lending
is hated at the moment," said Thomas Hayes, chairman at Great
Hill Capital.
    "That could change and as rates come down, there could be
some value here but for now it is probably a don't touch."
    U.S. mortgage rates have extended their surge as government
bond yields rally. The popular 30-year fixed rate hit its
highest level since 2000 last week, causing mortgage
applications to hit a 28-year low.
    SPACs are shell companies that raise funds through a public
listing with the goal of acquiring a private company and taking
it public.
    Amid ultra-low interest rates, the SPAC market exploded in
2021, but has since sputtered amid rising interest rates, high
redemption rates and increased regulatory scrutiny.

 (Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by
Sriraj Kalluvila)
 ((BansariMayur.Kamdar@thomsonreuters.com;  Twitter:
@BansariKamdar;))