The company has once more pushed back its special meeting as pressure mounts over the CrossCountry deal
Two Harbors Investment Corp.’s board is continuing to urge stockholders to approve its proposed acquisition by CrossCountry Mortgage – but it’s keeping the door open to UWM’s bid, once again pushing back the decisive meeting to June 23.
In a statement issued Monday morning, the company – which has been the subject of a tug-of-war between UWM and CrossCountry in recent weeks – said it still opposes UWM’s existing bid, describing the mortgage giant’s claims about the value of its offer as “backwards.”
UWM said its most recent offer was worth $12.50 per share in cash, or 2.3328 shares of company stock if a stockholder chose. But Two Harbors’ latest release disputed that logic.
“In fact, stockholders who fail to make a timely affirmative election in correct form would get UWMC stock, not cash,” the company said, adding that it expected around 25-30% of stockholders would not make timely elections. “TWO believes UWMC is counting on that in order to issue devalued stock at the expense of TWO stockholders.”
Its decision to once again adjourn that meeting indicates growing uncertainty about its ability to get the CrossCountry deal over the line amid reported pressure from stockholders, even if its language about UWM’s current offer was unequivocal. “The alternative to CCM is not a better deal. It is no deal at all,” it said.
The announcement marks the latest development in an increasingly fraught saga that began when TWO and UWMC inked a merger agreement in December, only for CrossCountry to swoop with an 11th-hour bid.
UWM president and chief executive officer Mat Ishbia blasted the Two Harbors leadership last month, describing it as “zero value” in an interview with Mortgage Professional America.
But despite the escalating war of words between the two companies, the TWO board isn’t turning its back on a potential deal with the wholesale lender, repeatedly delaying the all-important special meeting.
At the end of May, UWM suggested that a second adjournment suggested TWO’s stockholders “understand what their Board refuses to acknowledge” as doubts about the CrossCountry deal heightened.
And the latest meeting postponement suggests more twists and turns could be in store in the weeks ahead.
UWM has not yet responded to an MPA request for comment about the latest statement by Two Harbors.
Stay updated with the freshest mortgage news. Get exclusive interviews, breaking news, and industry events in your inbox, and always be the first to know by subscribing to our FREE daily newsletter.
