Annaly Ups Offer for Rest of CreXus

REIT Annaly Capital Management (NYSE: NLY  ) announced today that it has agreed to acquire the remaining shares of CreXus Investment (UNKNOWN: CXS.DL.DL  ) for $13 per share -- up from a previous offer of $12.50 -- for a total value of $872 million. Annaly currently owns approximately 12.4% of CreXus, and says it will purchase all remaining shares for $13 per share plus a prorated dividend payment.

The announcement pushed shares up to $13.28 as of this writing, a 6.2% premium over yesterday's $12.50 closing price.

Annaly had proposed a $12.50-per-share buyout on Nov. 9. The terms announced today stem from negotiations between Annaly and CreXus, and the $13 per share represents a 17% premium to Crexus' stock price before Annaly's initial acquisition proposal.

"This transaction represents a significant step toward Annaly's commitment to investing directly in commercial real estate assets," said Chairman and CEO Wellington Denahan in a statement today. "We believe that wholly owning the commercial real estate platform we currently manage through [Fixed Income Discount Advisory Company] is complementary to our existing business and return profile and should provide stable and diversified risk-adjusted returns to our shareholders."

CreXus has 45 days in which to solicit and evaluate other offers.

The all-cash offer is part of Annaly's larger capital allocation strategy, and is aimed at helping to scale the company's commercial platform while diversifying its investment portfolio.

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  • Report this Comment On February 01, 2013, at 2:19 PM, cred13 wrote:

    Why would NLY bid over book on CXS. If CXS has anything NLY doesn't have, like their portfolio which NLX was responsible for, NLX could buy their own. Sounds like a perk for shareholders of CXS that NLY will soon have to explain to NLY shareholders.

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