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MFA Financial Beats Estimate, Will Buy Rest of Lima One

MFA Financial, the residential REIT, swung to a first-quarter profit from a year-earlier loss and will buy the stake it doesn't already own in Lima One.

MFA Financial  (MFA) - Get MFA Financial Inc. Report, the residential real estate investment trust, swung to a first-quarter profit from a year-earlier loss and said it would buy the stake it doesn't already own in Lima One.

The New York company posted quarterly earnings of 17 cents a share against a loss of $2.02 a share in the year-earlier quarter. A survey of analysts by FactSet was estimating profit of 8 cents a share in the latest period.

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Book value per share rose to $4.63 from $4.34 a year earlier. The FactSet consensus was $4.64 a share.

Strong returns on the company's portfolio of residential mortgages drove the earnings and book value, MFA said. The REIT also said it "made further progress on our initiatives to lower the costs of financing our investments."

The company also said on Thursday it planned to acquire the rest of Lima One Holdings from affiliates of Magnetar Capital, the Evanston, Ill., hedge fund. 

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Terms weren't disclosed.

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Lima One is the Greenville, S.C., servicer of business-purpose loans for investors in residential real estate.

The acquisition includes the Lima One operating platform, its $1.1 billion servicing portfolio and $200 million of related financial assets.

MFA will finance the purchase of Lima One with cash on hand, the company said.

The transaction is expected to close in the third quarter of 2021, subject to conditions including the receipt of applicable governmental clearances and third-party consents.

At last check MFA Financial shares were trading 1.8% lower at $4.33.