CYS Investments’ stock soars after buyout deal with fellow REIT Two Harbors Investment


Shares of CYS Investments Inc.
cys
shot up 10.1% in premarket trade Thursday, after the agency mortgage real estate investment trust (REIT) said it agreed to be acquired by fellow REIT Two Harbors Investment Corp.
TWO,
-0.45%,
in a deal that would value CYS at about $1.21 billion. Two Harbors shares slumped 1.5% ahead of the open. Under terms of the deal, CYS shareholders will receive $7.79 of combined cash and Two Harbors stock for each CYS share they own, representing an 17.7% premium to Wednesday’s closing price of $6.62. Two Harbors expects the deal to add to earnings and reduce operating expense ratio. After the deal closes, which is expected to occur in the third quarter of 2018, Two Harbors expects its quarterly dividend to be sustainable through 2018, subject to market conditions. CYS shares have dropped 17.6% year to date through Wednesday, while Two Harbors’s stock has lost 2.9%, the SPDR Real Estate Select Sector ETF
XLRE,
+1.72%
has shed 8.3% and the S&P 500
SPX,
+0.03%
has eased 1.3%.


View more information: https://www.marketwatch.com/story/cys-investments-stock-soars-after-buyout-deal-with-fellow-reit-two-harbors-investment-2018-04-26

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