WMC - AG Mortgage Investment offers to acquire Western Asset Mortgage for $9.88/share

2023-07-13 08:21:57 ET

AG Mortgage Investment Trust ( NYSE: MITT ) said Thursday it offered to buy Western Asset Mortgage Capital ( NYSE: WMC ) for an implied price of $9.88 per share, consisting of a stock consideration of $8.90 a share and cash consideration of $0.98 a share.

MITT gapped down 6.4% in premarket trading, while WMC climbed 2% . Typically shares of the company being acquired rise as the acquiring company likely paid a premium on its shares.

In this case, the non-binding proposal represents an 18.2% premium to WMC's closing share price on Wednesday.

"Our complementary core competences in residential mortgage credit would establish an even more efficient and competitive company," MITT wrote in a latter to the WMC board.

Under the terms of the MITT proposal, each share of WMC common stock would be converted at closing into the right to receive 1.468 shares of MITT common stock  pursuant to a fixed exchange ratio, as well as a cash payment from Angelo Gordon equal to the lesser of $7.0M or ~9.9% of the aggregate per share merger consideration.

The offer comes after WMC last month agreed to merge with Terra Property Trust in an all-stock transaction.

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