#United States #Cleveland #UWM #CrossCountry #Two Harbors

CrossCountry Mortgage: Ensuring Shareholder Value in the Acquisition of Two Harbors

In recent corporate maneuvers, CrossCountry Mortgage, LLC (CCM) has made a significant statement regarding its planned acquisition of Two Harbors Investment Corp. (TWO), asserting that this agreement represents the most assured path for stockholders to gain value. This announcement comes in response to assertions made by UWM Holdings Corporation (UWM), which has put forward a competing proposal that CCM claims is fundamentally flawed and uncertain.

The Importance of Certainty and Commitment

CCM highlights that its acquisition agreement is fully financed and is an all-cash transaction, which promises speed and certainty for TWO’s investors. In contrast, UWM's proposal has been labeled as non-binding and lacks the financial guarantees presented by CCM. Stockholders face a decisive choice: accept the security of an executed cash transaction with CrossCountry or gamble on UWM's less certain approach.

Financing Robustness

CCM has successfully secured a formidable financing package that guarantees real monetary returns for TWO stockholders. Starting with a $2.0 billion secured financing commitment, CrossCountry has subsequently added an unsecured facility commitment totaling $1.4 billion from Citi, totaling an impressive $3.4 billion in financing commitments. This financial backing stands in stark contrast to UWM's precarious financial situation, which raises questions about its ability to follow through on its proposals.

Evaluating UWM's Bid

UWM's bid includes a default stock consideration worth less than CCM's cash offer. Specifically, the stock value put forth by UWM remains significantly below the guaranteed cash amount offered by CrossCountry, raising concerns about stockholder returns should UWM’s proposal be accepted. The risks associated with UWM's offer also encompass intricate regulatory hurdles and uncertainties surrounding the timeline for closing the acquisition, which could ultimately disadvantage TWO’s shareholders.

Regulatory Approval and Experience

CCM has also underscored its advantage regarding regulatory approvals, having obtained nearly half of the necessary approvals for the transaction already. UWM, on the other hand, would be required to restart the regulatory approval process entirely, leading to additional delays and uncertainties. The credibility and experience of CCM in managing the regulatory landscape stands in stark contrast to UWM's inexperience in such transactions.

Business Continuity Considerations

The potential disruption to business continuity during the acquisition process is yet another point of concern when considering UWM's bid. Previous public statements from UWM raise doubts about its intentions and understanding of the business value inherent in Two Harbors. CCM's commitment to a smooth transition and integration process further solidifies their approach as favorable for maintaining operations and employee stability.

The Takeaway: A Clear Choice for Stockholders

As the May 19 special meeting approaches, shareholders are faced with a pivotal decision. CrossCountry Mortgage encourages TWO stockholders to consider the tangible benefits of its acquisition offer, which assures cash value and regulatory preparedness, versus UWM's speculative proposal that poses significant risks. In a landscape fraught with uncertainty, the choice becomes clear: opting for an assured path with CrossCountry can ensure stronger outcomes for shareholders in a competitive market.

About CrossCountry Mortgage

As a leading entity in the mortgage industry, CrossCountry Mortgage has established itself as the top retail mortgage lender in the United States. With a dedicated team and an extensive range of mortgage solutions, CCM emphasizes a customer-first approach, positioning itself favorably in a competitive environment. For further inquiries or details regarding their operations, potential investors can visit crosscountrymortgage.com.