Annaly Capital Management, Inc. Announces Agreement to Sell Its Commercial Real Estate Bus. to Slate Asset Management for $2....
March 25 2021 - 3:05PM
Business Wire
Annaly Capital Management, Inc. (NYSE: NLY) (“Annaly” or the
“Company”) today announced that it has entered into a definitive
agreement to sell its Commercial Real Estate business to Slate
Asset Management L.P. (“Slate”), a global investment and asset
management firm focused on real estate.
The transaction is valued at $2.33 billion and represents
substantially all of the assets that comprise the Company’s
Commercial Real Estate business, which include equity interests,
loan assets and commercial mortgage-backed securities. Certain
Annaly employees who primarily support the Commercial Real Estate
business are expected to join Slate upon completion of the sale,
including Timothy Gallagher, Head of Commercial Real Estate, and
Michael Quinn, Head of Commercial Investments.
“The Commercial Real Estate business has been an important
component of Annaly’s differentiated investment model since 2013,”
remarked David Finkelstein, Annaly’s Chief Executive Officer and
Chief Investment Officer. “This transaction delivers compelling
execution for our shareholders and will provide additional capacity
to further expand our leadership and operational capabilities
across all aspects of the residential mortgage finance market,
which has been the cornerstone of Annaly’s strategy since our
founding. On behalf of our entire Company and Board of Directors, I
want to sincerely thank all of the employees who have supported and
built our Commercial Real Estate business over the years.”
Annaly expects the transaction to have an immaterial impact on
key financial metrics, including book value, core earnings and the
Company’s dividend. Upon closing of the transaction, the Company
intends to use proceeds from the sale to repay its financing
facilities related to the commercial real estate assets being sold
and to purchase targeted assets in accordance with its capital
allocation policy, which may include investments in Agency assets
as well as residential and corporate credit assets. Annaly
anticipates maintaining limited exposure to the commercial real
estate sector through opportunistic and efficient strategies within
the securities portfolio.
Subject to customary closing conditions, including applicable
regulatory approvals, the transfer of the Commercial Real Estate
business is expected to be completed by the third quarter of
2021.
Evercore is serving as financial advisor and Ropes & Gray
LLP is serving as legal advisor to Annaly. BMO Capital Markets is
serving as financial advisor and Goodwin Procter LLP and McCarthy
Tétrault LLP are serving as legal advisors to Slate.
About Annaly
Annaly is a leading diversified capital manager that invests in
and finances residential and commercial assets. Annaly’s principal
business objective is to generate net income for distribution to
its stockholders and to optimize its returns through prudent
management of its diversified investment strategies. Annaly is
internally managed and has elected to be taxed as a real estate
investment trust, or REIT, for federal income tax purposes.
Additional information on the company can be found at
www.annaly.com.
About Slate Asset Management
Slate Asset Management is a leading real estate-focused
alternative investment platform with approximately $6.5 billion in
assets under management. Slate is a value-oriented manager and a
significant sponsor of all of its private and publicly traded
investment vehicles, which are tailored to the unique goals and
objectives of its investors. The firm's careful and selective
investment approach creates long-term value with an emphasis on
capital preservation and outsized returns. Slate is supported by
exceptional people, flexible capital and a demonstrated ability to
originate and execute on a wide range of compelling investment
opportunities. Visit slateam.com to learn more.
Forward-Looking Statements
This news release and our public documents to which we refer
contain or incorporate by reference certain forward-looking
statements which are based on various assumptions (some of which
are beyond our control) and may be identified by reference to a
future period or periods or by the use of forward-looking
terminology, such as "may," "will," "believe," "expect,"
"anticipate," "continue," or similar terms or variations on those
terms or the negative of those terms. Actual results could differ
materially from those set forth in forward-looking statements due
to a variety of factors, including, but not limited to, risks and
uncertainties related to the COVID-19 pandemic, including as
related to adverse economic conditions on real estate-related
assets and financing conditions; changes in interest rates; changes
in the yield curve; changes in prepayment rates; the availability
of mortgage-backed securities and other securities for purchase;
the availability of financing and, if available, the terms of any
financing; changes in the market value of our assets; changes in
business conditions and the general economy; our ability to grow
our commercial real estate business; our ability to grow our
residential credit business; our ability to grow our middle market
lending business; credit risks related to our investments in credit
risk transfer securities, residential mortgage-backed securities
and related residential mortgage credit assets, commercial real
estate assets and corporate debt; risks related to investments in
mortgage servicing rights; our ability to consummate any
contemplated investment opportunities; changes in government
regulations or policy affecting our business; our ability to
maintain our qualification as a REIT for U.S. federal income tax
purposes; and our ability to maintain our exemption from
registration under the Investment Company Act of 1940. For a
discussion of the risks and uncertainties which could cause actual
results to differ from those contained in the forward-looking
statements, see "Risk Factors" in our most recent Annual Report on
Form 10-K and any subsequent Quarterly Reports on Form 10-Q. We do
not undertake, and specifically disclaim any obligation, to
publicly release the result of any revisions which may be made to
any forward-looking statements to reflect the occurrence of
anticipated or unanticipated events or circumstances after the date
of such statements, except as required by law.
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Annaly Investor Contact
Annaly Capital Management, Inc. Investor Relations 1-888-8Annaly
investor@annaly.com
Annaly Media Contact
Brunswick Group Alex Yankus 212-333-3810
ANNALY@brunswickgroup.com
Slate Investor Contact
Investor Relations +1 416 644 4264 ir@slateam.com
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