Two Harbors Awaits Final State Approval as CCM Merger Dividend Formula Adjusted
Two Harbors Awaits Final State Approval as CCM Merger Dividend Formula Adjusted
Two Harbors Investment Corp. is nearing the finish line in its acquisition by CrossCountry Intermediate Holdco LLC, announcing that regulatory approvals have been secured from all but one state. The remaining authorization is necessary to finalize the transaction, which is now expected to close later than the previously targeted Aug. 3 date.
Due to the delayed timeline, the companies have updated the calculation method for the “stub period” dividend that will be paid to Two Harbors shareholders. While earlier estimates had placed the payment at roughly $0.122 per share based on the August closing target, the final amount will now be determined by the actual effective date.
According to the filing, the stub dividend will be derived by multiplying Two Harbors’ most recent quarterly dividend of $0.34 by the number of days elapsed between the end of the second quarter of 2026 and the day prior to the merger closing. That figure will then be divided by 92, representing the total days in the third quarter. The payout will be issued to shareholders of record immediately before the merger becomes effective and will not reduce the total merger consideration.
The transaction, valued at approximately $1.26 billion, emerged following a public bidding war with UWM Holdings Corporation. CCM initially offered $10.80 per share in March before incrementally raising the bid to $12 per share in May, a price that represented a 19% premium to Two Harbors’ tangible book value at the end of March.
Upon closing, the deal will combine CCM’s retail origination and servicing platform with Two Harbors’ portfolio of mortgage assets. CCM originated $51 billion in mortgages in 2025, ranking as the seventh-largest lender overall. Two Harbors is set to contribute a $159 billion mortgage servicing rights (MSR) portfolio to complement CCM’s existing $202 billion book.
What to watch
- Regulatory status: Investors should monitor announcements regarding the final pending state approval, which will trigger the actual closing date and finalize the stub dividend calculation.
- Market activity: UWM Holdings Corporation stock is up 6.64% today, trading at $1.95, with a market capitalization of approximately $3.15 billion.
Source: original release