AG Mortgage offers to acquire Western Asset Mortgage for $9.88 per share

AG Mortgage Investment Trust (MITT) announced this morning that it submitted a proposal to the board of Western Asset Mortgage Capital (WMC) to acquire WMC for a fixed exchange ratio, representing an implied price of $9.88 per share, consisting of a stock consideration of $8.90 per share and cash consideration of 98c per share. The offer represents an 18.2% premium to WMC’s closing share price, the company said in a statement. “We believe combining WMC with MITT would result in a focused, residential mortgage REIT with an optimized capital structure and significant growth potential and value-creating opportunities for the combined company’s stockholders. Our complementary core competences in residential mortgage credit would establish an even more efficient and competitive company. Importantly, our proposal provides closing certainty and does not accelerate WMC’s convertible notes, while also benefiting WMC stockholders, particularly given the cash consideration we describe in greater detail below, significant opportunities for cost synergies, and expected earnings accretion following the transaction’s close. We stand ready to engage meaningfully with the WMC Board of Directors and request that the WMC Board properly and expeditiously evaluate our offer given its substantial benefits to all stockholders,”” said AG Mortgage in a letter to the board.