TWOD TWO HARBORS INVESTMENT CORP.

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Executive Summary

Two Harbors Investment Corp. management filed additional definitive proxy soliciting materials urging stockholders to vote FOR the all-cash merger with CrossCountry Mortgage (CCM) at $12.00/share, directly rebutting a competing all-stock/partial-cash proposal from UWM Corporation (UWMC). The filing provides a quantitative comparison highlighting UWMC stock's decline to a $2.59 all-time low (making its default stock consideration worth ~$6.04/share) and UWMC's deteriorating credit profile, while emphasizing CCM's secured regulatory approvals (46 of 53) and fully-financed, election-free cash offer. The special meeting is postponed to June 23, 2026, with CCM agreeing to a waiver of non-solicitation through June 12 to allow engagement with UWMC on an all-cash proposal.

Actionable Insight

Key Facts

• CCM offers $12.00 per share all-cash to all TWO stockholders plus a pro-rated stub dividend; no election required; fully financed.
• CCM has secured 85% of required regulatory approvals (46 of 53) and obtained early termination of HSR waiting period.
• Special meeting postponed to June 23, 2026 at 10:00 a.m. ET.
• UWMC's stock closed at $2.59 all-time low on June 5, 2026; default stock consideration for non-electing holders worth ~$6.04/share.
• UWMC has no signed agreement with TWO; its proposal has a stock default structure estimated to catch 25-30% of stockholders.
• UWMC leverage increased from 2.45x (Q3 2025) to 3.18x (Q1 2026); Fitch downgraded credit outlook twice in four months.
• Bloomberg Corporate Default Risk Model shows UWMC 1-year default probability of 5.75%, up from 1.2% in December 2025.
• Board unanimously recommends FOR the CCM transaction on the WHITE proxy card.
• CCM agreed to waive non-solicitation provisions through June 12, 2026 to permit engagement with UWMC on an all-cash proposal.

Financial Impact

CCM offers $12.00 per share cash; UWMC competing proposal headlines $12.50 but default stock consideration value ~$6.04/share based on UWMC closing price of $2.59 on June 5, 2026; UWMC stock declined approximately 50% from $5.12 in December 2025.

Risk Factors

• Stockholders might reject the CCM deal on June 23, leaving TWO without an actionable transaction (CCM has said $12.00 is final and may walk away).
• UWMC could theoretically still surface a fully-financed, all-cash binding offer before June 12, creating a higher bid scenario.
• Regulatory approvals: 7 of 53 still outstanding; any denial could jeopardize closure timeline.
• Shareholder litigation related to the CCM transaction could delay or derail approval.

Market Snapshot

Documents Analyzed

This report is based on 4 SEC documents filed with EDGAR.

US Market Status

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