Countrywide Seeks Second Bailout Plan: N.Y. Post
Countrywide Financial is seeking a second multi-billion dollar bailout plan, as it continues to struggle because of the global credit crunch and a contracting U.S. housing market, the New York Post reported on its Web site on Tuesday.
The mortgage company is working with investment bank Goldman Sachs and law firm Wachtell Lipton Rosen & Katz to structure another strategic investment similar to the deal it struck with Bank of America last month, sources familiar with Countrywide's plans told the paper.
In that deal, Bank of America paid $2 billion for new, non-voting preferred stock in Countrywide
, which can be converted into common shares at $18 per share.
"Countrywide is in desperate need of cash right now to continue funding mortgages and the credit markets are still largely closed to them," a source familiar with the company told the Post.
The paper said details of who is involved in the investment were not clear but sources said one group, which could include J.P. Morgan and Citigroup as well as several hedge funds, has expressed interest in Countrywide.
Last week, Countrywide, which handles one in every five new U.S. mortgages, announced plans to cut as much as 12,000 jobs.