BlackRock and Highfields Capital beget PennyMac

BlackRock Inc. and hedge fund Highfields Capital Management said on Monday they have launched a new company that will buy and restructure distressed mortgage loans.

Stanford Kurland, a former top executive at mortgage giant Countrywide Financial Corp, will be the new company's chairman and chief executive officer.

The new company was named Private National Mortgage Acceptance Co., or PennyMac.

PennyMac plans to buy the mortgages cheaply, work with borrowers to restructure them, and then resell them at a profit as interest-earning mortgages.

BlackRock Inc. is a major American investment management firm. As of September 30, 2007, BlackRock’s assets under management totaled $1.3 trillion across fixed income, liquidity, equity, alternative investment and real estate strategies.

The firm headquartered in New York City and it operates 35 offices in 18 countries, among them markets in the United Kingdom, Asia, Australia and Europe.