CrossCountry raises bid for Two Harbors after rival offer from UWM

UWM Holding Corp. may not win the bid to acquire Two Harbors Investment Corp., but an unsolicited proposal for the real estate investment trust just forced CrossCountry Intermediate Holdco to raise its offering.

Two Harbors announced Tuesday that it amended its merger agreement to increase the all-cash price CrossCountry will pay to $11.30 per share. The price is up from $10.80 per share under the original March 27 agreement. Two Harbors’ Series A, B and C preferred stock will still be redeemed after closing at $25 per share plus any accumulated and unpaid dividends, consistent with existing terms.

The amendment follows an unsolicited competing proposal submitted on April 20 by UWM. The details of that proposal were not disclosed.

After reviewing the proposal with its financial and legal advisers, the Two Harbors board determined that the CrossCountry transaction, as amended, remains superior since it offers greater certainty of value through fixed, all-cash consideration that is not subject to a financing condition.

The Two Harbors board unanimously approved the amended merger agreement and scheduled a special meeting for shareholders on May 19. The board recommends the approval of the transaction.

“Our increased bid reflects our continued excitement for this transaction and our strong conviction in the strategic and financial merits of combining CCM and Two Harbors,” Ron Leonhardt, founder and CEO of CrossCountry Mortgage, said in a statement.

He added that CrossCountry’s and Two Harbors’ capital markets teams, along with RoundPoint Mortgage Servicing, are already working on the integration, and that the company has made “significant progress” in securing required federal and state regulatory approvals.

The companies continue to expect the transaction to close in the third quarter of 2026, subject to approval by shareholders and customary regulatory approvals.

Bill Greenberg, TWO’s president and CEO, said in a statement that the deal “pairs the country’s leading retail originator with RoundPoint’s best-in-class servicing platform, creating a fully integrated mortgage company.” 

In the first quarter, Two Harbors generated a comprehensive loss of $24.7 million. The company added $151.8 million in unpaid principal balance (UPB) of mortgage servicing rights (MSRs) through flow-sale acquisitions and recapture. Meanwhile, it funded $92.3 million in UPB in first-lien mortgages and brokered an additional $38.2 million in UPB in second-lien loans.

Upon completion of the transaction, Two Harbors’ common stock will be delisted from the New York Stock Exchange, the real estate investment trust will cease to be publicly traded, and it will become a wholly owned subsidiary of CrossCountry.

Houlihan Lokey Capital Inc. is serving as financial adviser to Two Harbors. Citi is acting as exclusive financial adviser to CrossCountry.