Annaly Capital to Buy Hatteras Financial for $1.5 Billion
April 11 2016 - 7:50AM
Dow Jones News
Mortgage investor Annaly Capital Management Inc. said it would
buy Hatteras Financial Corp. for about $1.5 billion dollars in a
cash and stock deal in a move to expand its adjustable-rate
holdings.
Both companies, which are structured as real-estate investment
trusts, have about 88.6% of their assets in mortgage-backed
securities. Annaly's portfolio is primarily fixed-rate securities,
while three-quarters of Hatteras Financial's interest-earning
portfolio was in adjustable-rate holdings.
The deal values Hatteras Financial at $15.85 per share, an 11%
premium over Friday's close. Hatteras Financial shareholders have
the option of receiving $5.55 in cash and 0.9894 shares of Annaly
stock, or $15.85 in cash or 1.5226 shares of Annaly stock. In all,
the deal will be made up of 65% in stock and about 35% in cash.
The deal has been unanimously approved by the boards of both
companies.
Annaly signed 30-month consulting agreements with four Hatteras
executives, including Chief Executive Michael Hough. The deal is
expected to close by the end of the third quarter of 2016.
Write to Austen Hufford at austen.hufford@wsj.com
(END) Dow Jones Newswires
April 11, 2016 07:35 ET (11:35 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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