Wired News – Two Harbors to Buy CYS Investments in Stock and Cash Deal

LONDON, UK / ACCESSWIRE / April 30, 2018 / Active-Investors.com has just released a free research report on Two Harbors Investment Corp. (NYSE: TWO) ("Two Harbors"). If you want access to this report all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=TWO as the Company's latest news hit the wire. On April 26, 2018, the Company announced that it has inked an agreement to acquire Waltham-based agency mortgage real estate investment trust (REIT), CYS Investments, Inc. (NYSE: CYS) ("CYS"), in a stock and cash deal. Register today and get access to over 1000 Free Research Reports by joining our site below:

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Active-Investors.com is focused on giving you timely information and the inside line on companies that matter to you. This morning, Two Harbors Investment and CYS Investments most recent news is on our radar and our team decided to put out a fantastic report on the company that is now available for free below:

www.active-investors.com/registration-sg/?symbol=TWO

www.active-investors.com/registration-sg/?symbol=CYS

Deal Details

• CYS' stockholders will exchange their shares for newly issued shares of Two Harbors common stock, as well as aggregate cash consideration of $15 million payable to CYS stockholders on a pro-rata basis. CYS' stockholders would receive $7.79 of combined cash and stock consideration per share of CYS common stock owned, which represents a premium of approximately 17.7% over the CYS closing price per share on April 25, 2018.

• Following the acquisition, all senior management positions will continue to be led by Two Harbors' personnel. Two Harbors' Board of Directors will include two additional independent directors from CYS' current board, James Stern and Karen Hammond.

• With the merger, PRCM Advisers LLC, Two Harbors' external manager, a subsidiary of Pine River Capital Management L.P., will reduce the base management fee it charges Two Harbors with respect to the additional equity under management resulting from the merger from 1.5% of stockholders' equity on an annualized basis to 0.75% through the anniversary of the closing.

• PRCM Advisers will also make a one-time downward adjustment of $15,000,000 to the management fees payable by Two Harbors for the quarter in which the merger closes. PRCM Advisers has also agreed to a post-closing downward adjustment of up to $3.3 million to reimburse Two Harbors for certain transaction-related expenses.

• The agreement, expected to close in Q3 2018, is subject to the satisfaction of certain customary conditions, and is subject to the approval of the stockholders of both Two Harbors and CYS.

Strategic Benefits of the Deal

Two Harbors expects the deal to add to its earnings and reduce its operating expense ratio. A larger capital base will support the continued growth across Two Harbors' target assets. With a pro-forma equity base of nearly $5.0 billion, Two Harbors' stockholders will benefit from the scale, liquidity, and capital alternatives of a larger combined company. Following the close of the transaction, Two Harbors expects to maintain its quarterly dividend of $0.47 per share.

CYS' Stockholders to Benefit from Increased Scale, Diversification, and Liquidity of the Combined Companies

Kevin Grant, Chairman, Chief Executive Officer (CEO), President, and Chief Investment Officer at CYS, stated that the Company is excited about the opportunity to merge with Two Harbors and believes that its stockholders will benefit from the increased scale, diversification, and liquidity of the combined Company. Grant added that Two Harbors has a long history of being strong stewards of capital and CYS believe this transaction should enhance value for its stockholders over the long-term.

News report suggest that post the announcement of the news, shares of CYS surged in pre-market trade.

About Two Harbors Investment Corp.

Founded in 2009 and headquartered in New York City, New York, Two Harbors, which is a Maryland corporation, is a real estate investment trust that invests in residential mortgage-backed securities, mortgage servicing rights, and other financial assets.

Stock Performance Snapshot

April 27, 2018 - At Friday's closing bell, Two Harbors Investment's stock dropped 1.23%, ending the trading session at $15.32.

Volume traded for the day: 2.46 million shares, which was above the 3-month average volume of 2.14 million shares.

After last Friday's close, Two Harbors Investment's market cap was at $2.77 billion.

Price to Earnings (P/E) ratio was at 10.52.

The stock has a dividend yield of 12.27%.

The stock is part of the Financial sector, categorized under the REIT - Residential industry. This sector was up 0.3% at the end of the session.

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