Cherry Hill Mortgage posts Q2 profit, announces merger deal
CHMI•Outlook
The company did not provide specific financial guidance because of the pending merger with TPG Mortgage Investment Trust.
Results drivers
- Net servicing income contributed $7.4 million to Q2 results.
- Realized and unrealized losses on RMBS and derivatives, as well as servicing-related asset losses and credit impairments, weighed on results, partially offset by a realized gain on derivatives.
- General and administrative expenses and compensation totaled $4.0 million in Q2.
Q2 profit and merger agreement
Cherry Hill Mortgage Investment Corporation said its second-quarter net income applicable to common stockholders returned to profit after the prior quarter loss.
Earnings available for distribution for Q2 totaled $5.5 million, or $0.15 per diluted share.
The company also entered a definitive merger agreement with TPG Mortgage Investment Trust, with an implied transaction value of $117.5 million. Under the deal, TPG Mortgage Investment Trust is set to acquire the company, and Cherry Hill stockholders would receive 0.3063 TPG shares and $0.93 cash per share.
