Two Harbors Investment Corp. Announces Definitive Agreement to Acquire RoundPoint Mortgage Servicing Corporation
03 August 2022 - 10:30PM
Business Wire
Two Harbors Investment Corp. (NYSE: TWO), an Agency + MSR
mortgage real estate investment trust, today announced that Matrix
Financial Services Corporation, a wholly owned subsidiary
(“Matrix”), has entered into a definitive stock purchase agreement
to acquire RoundPoint Mortgage Servicing Corporation (“RoundPoint”)
from Freedom Mortgage Corporation (“Freedom”).
In connection with the acquisition, Matrix has agreed to pay a
preliminary purchase price upon closing in an amount equal to the
tangible net book value of RoundPoint, plus a premium amount of
$10.5 million. This preliminary purchase price will be subject to
certain additional adjustments following the closing date.
Matrix has agreed to engage RoundPoint as a subservicer prior to
the closing date and expects to begin transferring loans to
RoundPoint in the fourth quarter of 2022. Upon closing, all
servicing licenses and capabilities will remain with RoundPoint,
and RoundPoint will become a wholly owned subsidiary of Matrix. The
parties expect to close the transaction in 2023, subject to the
satisfaction of customary closing conditions and the receipt of
required regulatory and government-sponsored entity approvals.
Anticipated Acquisition Benefits to Two Harbors
- Incremental annual pre-tax earnings of approximately $20
million, following the transfer of the company’s mortgage servicing
rights (“MSR”) portfolio to RoundPoint, through additional revenues
and cost savings as a result of vertically integrating
self-servicing capabilities.
- Greater control over the company’s MSR portfolio through
self-servicing.
- Long-term opportunities to expand upon and leverage
RoundPoint’s existing platform and capabilities to pursue
additional business opportunities.
“Our acquisition of RoundPoint marks an evolution in our MSR
strategy which will deliver long-term financial and strategic
benefits to Two Harbors,” stated Bill Greenberg, Two Harbors’
President, Chief Executive Officer and Chief Investment Officer.
“The operational efficiencies and revenue opportunities it presents
will add value for shareholders while deepening our involvement in
the industry.”
“We wish RoundPoint continued success,” said Stanley C.
Middleman, President and CEO of Freedom. “We’re excited about the
new opportunities in store for them with Two Harbors.”
“We are very excited to partner and accelerate our growth with
Two Harbors,” stated Patrick McEnerney, RoundPoint’s Chief
Executive Officer. “The transaction recognizes the strategic value
of our experienced team, robust platform, and dedication to serving
our customers well.”
Cadwalader, Wickersham & Taft LLP is serving as legal
advisor to Two Harbors. Hunton Andrews Kurth LLP is serving as
legal advisor to Freedom and RoundPoint.
Cautionary Notice Regarding Forward-Looking
Statements
This release may include statements and information that
constitute “forward-looking statements” within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended, and we
intend such forward-looking statements to be covered by the safe
harbor provisions therein and are included in this statement for
purposes of invoking these safe harbor provisions. Forward-looking
statements include statements with respect to our beliefs, plans,
objectives, goals, targets, expectations, anticipations,
assumptions, estimates, intentions and future performance. The
forward-looking statements made in this release include, but may
not be limited to, Matrix’s engagement of RoundPoint as a
subservicer prior to closing, RoundPoint’s business and
capabilities following the closing date, the anticipated timing of
the closing of the transaction and statements about the anticipated
benefits of the proposed acquisition to Two Harbors.
Forward-looking statements are not guarantees, and they involve
risks, uncertainties and assumptions. There can be no assurance
that actual results will not differ materially from our
expectations. We caution investors not to rely unduly on any
forward-looking statements and urge you to carefully consider the
risks identified under the captions “Risk Factors,”
“Forward-Looking Statements” and “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” in our
public filings with the SEC, which are available on the SEC’s
website at www.sec.gov.
All written or oral forward-looking statements that we make, or
that are attributable to us, are expressly qualified by this
cautionary notice. Except to the extent required by applicable laws
and regulations, we undertake no obligations to update these
forward-looking statements to reflect events or circumstances after
the date of this release or to reflect the occurrence of
unanticipated events.
Two Harbors Investment Corp.
Two Harbors Investment Corp., a Maryland corporation, is a real
estate investment trust that invests in residential mortgage-backed
securities, mortgage servicing rights and other financial assets.
Two Harbors is headquartered in St. Louis Park, Minnesota.
Additional Information
Stockholders of Two Harbors and other interested persons may
find additional information regarding the Company at the Securities
and Exchange Commission’s Internet site at www.sec.gov or by
directing requests to: Two Harbors Investment Corp., 1601 Utica
Ave. S., Suite 900, St. Louis Park, MN, 55416, telephone (612)
453-4100.
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version on businesswire.com: https://www.businesswire.com/news/home/20220803005902/en/
Paulina Sims, Senior Director, Investor Relations, Two Harbors
Investment Corp., (612) 446-5431,
Paulina.Sims@twoharborsinvestment.com
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