(Annaly Capital( CXS), Crexus( CXS) report updated with recent broker action on Annaly Capital.)
NEW YORK (TheStreet) -- Crexus Investment( CXS), in which Annaly Capital Management( CXS) is a 25% owner, rejected an acquisition bid from Starwood Property Trust (STWD) - Get Report and priced a secondary offering at a steep discount.
Crexus shares had surged nearly 14% at midday Monday when Starwood Property made an unconditional offer to acquire all of the outstanding shares of Crexus Investment for $14.00 per share. That offer represented a 20% premium to Crexus' trading price earlier in the day, ahead of the offer.
Starwood's offer was contingent on Crexus abandoning its plans for a secondary offering. The offering was announced a week earlier as Crexus looked to acquire a commercial real estate mortgage loan portfolio from
But Crexus rejected Starwood's bid and then late Monday Crexus announced it had priced the underwritten public offering of 50 million shares at $11.50 per share, hoping to raise gross proceeds of around $575 million. Underwriters were granted the option to purchase up to an additional 7.5 million shares to cover over-allotments.
Concurrent with the offering, Annaly Capital, the parent company of Crexus' external manager,
Fixed Income Discount Advisory
, will acquire 5 million shares of Crexus in a private placement at the same price per share.
Both offerings are expected to close on or around April 1.
Annaly Capital shares shed 3.3% to close at $17.44 on Tuesday. The stock went
ex-dividend Tuesday, meaning the security was traded without the 62-cent declared dividend. By that measure, Annaly shares fell just 0.3% in the session.
Wednesday morning Annaly shares were 0.5% higher ahead of the opening bell.
Starwood Property Trust gained 0.2% to $22.50 on Tuesday and were flat in premarket trading Wednesday. Crexus closed 1.4% lower to $11.40 on Tuesday, well off the session's lows, and the stock rose 0.4% in premarket trading Wednesday.
On Monday, equities research analysts from Lazard Capital issued a downgrade on shares of Annaly Capital to a hold rating, from a buy.
Last week analysts at Stifel Nicolaus also downgraded Annaly shares to hold from buy.
Meanwhile, analysts at Zacks Investment Research upgraded the REIT stock to neutral from underperform, according to a note published in late January.
-- Written by Miriam Marcus Reimer in New York.
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