LoanDepot’s Hsieh leaves his day-to-day job due to proxy fight
Anthony Hsieh has resigned as loanDepot’s executive chairman by mutual consent. He was replaced by Frank Martell, former CoreLogic executive and president. Martell, who rose to the top of the company’s hierarchy in April 2022, is now the president and CEO of the company. Hsieh is still loanDepot board chairman.Mark Brown/Photographer Mark Brown/Getty I. On Tuesday afternoon, Hsieh sent a letter to loanDepot’s board stating that he was the company’s majority shareholder and that he would nominate and, given his 57% voting rights, install Steven Ozonian, the CEO of title underwriter Williston Financial Group. This news caused investors to react negatively, with the stock closing at $2.49 per share on Tuesday, down 4.8% from its close of $2.61 on Tuesday close of $2.61. This is a significant drop from the initial public offering price in February 2021 of $14 per share. Hsieh stated that the loanDepot board had not been open to Hsieh’s attempts to change its composition. Hsieh stated in his press release that the board, as leaders of the company and stewards stockholder capital, must constantly challenge itself to be a dynamic centre of passionate, informed, and relevant perspectives to guide the company towards its future success. “The recent rate rise and the challenging macroeconomic environment make Mr. Ozonian’s appointment urgent.” At the next meeting, only two positions on the board are up for election. Hsieh wrote to the board that his original proposal was for Ozonian to be named to replace a member who had ended their term early. Hsieh’s letter to the board stated that his original proposal was to name Ozonian to replace a member who would end their term early. The other position is held by Andrew Dodson, the representative from Parthenon Capital which has been an investor at loanDepot since 2009. Hsieh must support Dodson’s reelection under shareholder agreements. Hsieh stated that he was targeting Patenaude personally, but the seat was the only one left. A statement from the company said that Hsieh was rushing the matter. Hsieh made it known that he was going to interview Ozonian as part the ongoing process of evaluating potential nominees. Dawn Lepore, chairperson of the nominating committee and loanDepot press release stated that “It is disappointing and disappointing that Mr. Hsieh would try to circumvent the company’s process for assessing potential directors nominees.” We are not sure why he would launch a disruptive proxy contest to replace his nominee, when Mr. Ozonian is currently being evaluated. “The board then listed Patenaude’s resume, including her recent appointment to the Home Builders Institute board. She assumed her loanDepot position in July 2021. LendingTree declined to comment further. Ozonian was the former CEO of LendingTree’s real estate brokerage company. His other positions included being the national homeownership executive of Bank of America, and the CEO of Realtor.com. This is the latest turmoil at the company which suffered a loss of $137.5m in the third quarter. After its second quarter results announcement, which included the decision to exit wholesale loans, loanDepot executives acknowledged that Hsieh had been wrongfully terminated. This was allegedly due to her refusal to take part in a scheme to lower underwriting standards as the company sought to increase volume before its initial public offering. Richards also claimed that loanDepot, Hsieh and other employees operated a frathouse environment. She also sued loanDepot and an appraiser for allegedly discriminating against them.