UWM Fails to Submit Revised Harbors Bid as Waiver Expires
Two Harbors Investment Corp. disclosed on Monday that UWM Holdings did not deliver a revised bid to buy the company or ask for more time to negotiate after a negotiated waiver expired. The development strengthens CrossCountry Mortgage's plan, which remains on the table as the company urges Two Harbors' shareholders to approve the CCM deal.
In a letter to investors, Two Harbors said the waiver period, extended after feedback from investors and a recommendation from proxy adviser ISS, ended on Friday. CrossCountry Mortgage is offering $12 per share in cash, plus a stub dividend. A vote on the CCM proposal is scheduled for June 23. By contrast, UWM had proposed $12.50 per share in cash, or an option to take 2.3328 shares of UWMC stock for each Two Harbors share.
What UWM Offered Versus CCM’s Offer
The contrast between the two proposals has been at the center of the debate for Two Harbors’ board and its investors. CCM argues that its all-cash plan provides certainty, while UWM’s mix of cash and stock would shift more value to equity in a transaction that could be challenged by stockholder preferences for cash.
- CCM offer: $12 per share in cash, plus a stub dividend, with a vote set for June 23.
- UWM offer: $12.50 per share in cash, or 2.3328 UWMC shares per Two Harbors share.
- Waiver period: Granted after investor feedback and ISS recommendation; expired Friday.
Key Meetings and Deadlines
Two Harbors said its CEO, William Greenberg, invited UWM’s CEO, Mat Ishbia, to meet on June 8 to discuss additional due diligence and potential bids. Ishbia scheduled a video call for the following Thursday, but the company did not submit a formal revised proposal by the deadline.
During the video call, UWM reportedly floated several concepts, including switching the default consideration to cash, and potentially changing the way non-electing stockholders would be treated in a stock-versus-cash decision. Two Harbors noted that, while it encouraged UWM to outline additional diligence needs, the bidder did not provide specific requests. Greenberg followed up with further emails offering more meetings, which UWM reportedly declined to schedule.
Board and Shareholder Implications
The Two Harbors board has repeatedly voiced concerns that UWM’s latest proposal would have defaulted non-electing stockholders into UWM stock rather than cash, a move that could dilute cash certainty for investors focused on liquidity and immediate value. Two Harbors highlighted that the default mechanism, if adopted, would have created a materially different risk-and-return profile for stockholders who do not elect cash.
Observers say the lack of a written, revised bid from UWM during the waiver window leaves CCM’s cash-and-stub plan with a clearer path to closing, assuming regulatory and shareholder approvals. The absence of a fresh written bid also raises questions about UWM’s appetite for a negotiated sale at Two Harbors’ current terms.
Market Read Through and Investor Sentiment
Analysts say the episode underscores the pressure points in a highly negotiated sale involving mortgage and investment firms amid shifting interest-rate and housing market dynamics. With a cash offer on the table from CCM and a mixed cash-stock option from UWM, investors have been weighing certainty against potential upside from stock exposure.
In the days following the waiver expiry, trading activity around Two Harbors shares cooled as market participants waited for any formal bid letter or new diligence disclosures. The lack of a revised bid has kept focus on how shareholders will respond to the CCM proposal on June 23.
What Comes Next for Shareholders and Lenders
If the CCM deal wins shareholder approval and regulatory clearance, the transaction could close in the coming weeks, subject to customary closing conditions. If UWM eventually submits a revised bid, it would need to clear a narrow window to compete with CCM’s terms or present a more compelling option for Two Harbors’ board and investors.
The ongoing negotiation cadence means lenders involved with Two Harbors’ financing arrangements are watching closely. A revised bid would require diligence updates, potential adjustments to financing commitments, and a reassessment of any interplay with Two Harbors’ existing loan portfolios.
Analyst and Executive Commentary
Two Harbors’ leadership has pushed for a resolution that maximizes shareholder value and preserves liquidity for investors. Greenberg has emphasized that the board remains open to meaningful enhancements to diligence and bid structure if UWM or any other suitor can present a substantial written proposal. In response, Ishbia signaled a willingness to reassess, but the clock ran out on the waiver period without a formal bid.
Industry watchers note that the situation could re-emerge if market conditions shift or if UWM re-enters talks with a revised plan. The ultimate decision rests with Two Harbors’ shareholders, who will weigh the certainty of CCM’s cash offer against the potential upside of a stock-based option from UWM—and the risk of a delayed closing.
Key Data Points
- Waiver period expiration: Friday (per Two Harbors’ note to investors)
- CCM offer: $12 per share in cash, plus a stub dividend; June 23 vote date
- UWM offer: $12.50 per share in cash, or 2.3328 UWMC shares per Two Harbors share
- Meeting with UWM CEO: Invited for June 8; video call scheduled for Thursday
- Board concern: Default of non-electing stockholders into UWM stock would shift value away from cash certainty
- Market reference point: Based on Two Harbors’ June 12 closing price used in prior calculations
In sum, the narrative around the Two Harbors sale continues to hinge on the choice between a sure cash path via CCM and a more complex, stock-inclusive possibility from UWM. The phrase that has circulated among market watchers — fails submit revised harbors — captures a turning point in this deal: without a formal revised bid, the field narrows to a straightforward cash-and-stub structure that favors CCM or a future, less certain bid from UWM. As the June 23 vote approaches, investors are watching closely to see whether UWM re-engages with a written offer or if the Two Harbors board sticks with the CCM path and its cash certainty.
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