MGIC, Radian Terminate Merger Pact

MGIC Investment Corp., Milwaukee, and Radian Group Inc., Philadelphia, have terminated their merger agreement, the parties announced Sept. 5 in a joint statement.All outstanding lawsuits between the two companies are being dismissed, and neither made any payment to the other in connection with the termination of the deal. S.A. Ibrahim, chief executive of Radian, said, "[O]ur mutual decision to terminate the pending merger represents the best outcome for both companies under the circumstances." In a separate release issued by Radian, Mr. Ibrahim said Radian is "confident" that it can deliver on its strategic plan as a stand-alone company, and that "While there are significant credit challenges in today's mortgage market, we also believe that there are tremendous opportunities for our company in the mortgage insurance and financial guaranty markets, and our management team is moving aggressively to position Radian for future success." Investors, who drove down the stock prices of both companies following revelations of problems with their joint venture, C-BASS, responded to the news by pushing Radian's stock up nearly 9%, to $19.73, and MGIC's by over 2%, to $30.99, as of noon on Sept. 5.