Detroit News: Sudip Datta on Dan Gilbert's Quicken Loans IPO
Billionaire businessman Dan Gilbert is known in Detroit as much for his role in redeveloping downtown as he is for founding and leading Quicken Loans, the nation's largest mortgage lender. While a proposal, made public Tuesday, to take Quicken and several related subsidiaries public under the name Rocket Companies could be momentous for the company and bring attention to its hometown, experts and observers say the deal would likely have little effect on Gilbert's downtown real-estate plays. But the deal will limit the flow of resources from the Rocket Companies to Gilbert's Bedrock commercial real estate firm, experts said. And taking Rocket Companies public means the company will be accountable to shareholders on a quarterly basis, which could result in pressure for shorter-term results. But, going forward, there will be a "Chinese wall" between Rocket Companies and Gilbert's private companies, said Sudip Datta, a professor of finance at Wayne State University's Mike Ilitch School of Business: "Right now (Gilbert) can move money from here to there, because everything belongs to him as a private businessperson." It's hard to say to what degree that type of activity occurs now, because the businesses are private, but it's safe to say Quicken is the "cash cow" of the family, he said. However, Datta agrees that Gilbert likely remains committed to his investments in downtown Detroit: "He won't be able to fund those non-Quicken ventures from Quicken Loans, but he is a wealthy man, and he seems very committed to Detroit."
