Two Harbors Investment Corp. TWO today announced it
has entered into an agreement with Silver Bay Realty Trust Corp. (“Silver
Bay”), which will enable Silver Bay to acquire a portfolio of more than 3,100
single-family residential properties simultaneously with the closing of Silver
Bay's initial public offering of its common stock (“IPO”).
Pursuant to a contribution agreement, Two Harbors expects to contribute its
existing portfolio of over 2,200 single-family properties to Silver Bay,
together with $50 million in cash that will be used by Two Harbors to acquire
and renovate properties through the closing. In exchange for the contribution,
Two Harbors will receive approximately 17.8 million shares of common stock of
Silver Bay, which will represent approximately 47.7% of the outstanding stock
of Silver Bay after the offering or approximately 45.3% if the underwriters
exercise their option to acquire additional shares within 30 days following
the offering. The shares received by Two Harbors will be subject to a 90-day
lock-up period following the closing of the IPO, after which Two Harbors may,
subject to the discretion and approval of its Board of Directors and in
compliance with applicable securities laws, hold, sell or otherwise dispose of
the shares, which may include a distribution of the shares by means of a
special dividend to Two Harbors shareholders. The Silver Bay common stock will
be listed on the New York Stock Exchange under the symbol “SBY.”
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