Key Takeaways
Two Harbors Investment Corp. (NYSE: TWO) secured an increased offer from CrossCountry Mortgage, with the acquirer raising its all-cash bid to $11.30 per share following a rival proposal from UWM Holdings Corp.
"Our increased bid reflects our continued excitement for this transaction and our strong conviction in the strategic and financial merits of combining CCM and TWO Harbors," said Ron Leonhardt, Founder and CEO of CrossCountry Mortgage, in a statement.
The new price represents a 4.6 percent increase from the original $10.80 per share agreement announced March 27. The amendment comes after a shareholder lawsuit filed April 17 alleged the initial price was inadequate, citing previous offers as high as $15 per share and challenging a $25.4 million termination fee. The revised deal was struck after Two Harbors received an unsolicited competing proposal from UWM on April 20.
The board's decision to accept the revised CrossCountry offer suggests a preference for deal certainty over a potentially higher but more complex bid from UWM. The focus now shifts to the May 19 shareholder vote, with the transaction expected to close in the third quarter of 2026, at which point TWO will be delisted from the New York Stock Exchange.
After a thorough evaluation of the competing proposal from UWM, the Two Harbors board determined that the amended agreement with CrossCountry is in the best interests of its stockholders. In a press release, the board stated the revised transaction provides "superior certainty of value through fixed, all-cash consideration that is not subject to any financing condition."
Under the amended terms, Two Harbors' Series A, Series B, and Series C preferred stock will be redeemed for $25.00 per share in cash, plus any accrued and unpaid dividends upon closing.
Houlihan Lokey Capital, Inc. is serving as financial advisor to Two Harbors, with Jones Day acting as legal counsel. Citi is the exclusive financial advisor to CrossCountry Mortgage, and Simpson Thacher & Bartlett LLP is acting as its legal counsel.
This article is for informational purposes only and does not constitute investment advice.
