Two Harbors Amends Merger Agreement with CrossCountry Mortgage, Boosting Cash Offer to $12.00 Per Share
TWO sits 41% above its 52-week low of $8.78.
Summary
Two Harbors Investment Corp. has increased its all-cash merger consideration with CrossCountry Mortgage to $12.00 per share, up from $11.30, and updated financing terms, reaffirming its board's recommendation amidst a competing bid.
Key Events · M&A and Partnerships · TWO
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Merger Consideration Increased
Two Harbors common stockholders will now receive $12.00 per share in cash, an increase from the previous offer of $11.30 per share under the First Amendment.
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Termination Fee Adjusted
The termination fee payable by Two Harbors to CrossCountry Mortgage under certain conditions has been increased from $50.0 million to $51.0 million.
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Financing Commitments Updated
The agreement now references a $1.4 billion unsecured financing commitment obtained by CrossCountry Mortgage, with financing not being a condition to closing.
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Board Reaffirms Recommendation
Two Harbors' Board of Directors unanimously approved the Second Amendment and continues to recommend stockholders approve the merger with CrossCountry Mortgage.
Analysis · TWO · Real Estate & Construction
This 8-K announces a significant amendment to the merger agreement with CrossCountry Mortgage, directly increasing the cash payout to shareholders. The $0.70 per share increase in consideration, coupled with updated financing commitments, strengthens the deal's attractiveness. This move comes in response to an unsolicited bid from UWMC and highlights the board's commitment to maximizing shareholder value and ensuring deal certainty. The unanimous board recommendation reinforces confidence in the revised terms and the path to closing.
At the time of this filing, TWO was trading at $12.40 on NYSE in the Real Estate & Construction sector, with a market capitalization of approximately $1.3B. The 52-week trading range was $8.78 to $14.17. This filing was assessed with positive market sentiment and an importance score of 9 out of 10.