Merger to Close July 12, 2016
NEW YORK--(BUSINESS WIRE)--
Annaly Capital Management, Inc. (NYSE:NLY) (“Annaly”), announced today
that it has completed the previously announced exchange offer for all of
the outstanding shares of common stock of Hatteras Financial Corp.
(NYSE:HTS) (“Hatteras”).
The exchange offer to acquire all of the outstanding shares of Hatteras
common stock expired at 5:00 p.m., Eastern Time, on July 11, 2016. The
depositary for the exchange offer has informed Annaly that a total of
70,066,823 shares of Hatteras common stock, representing approximately
74.12% of Hatteras’ outstanding common stock, were validly tendered and
not validly withdrawn in the exchange offer. All shares that were
validly tendered and not validly withdrawn have been accepted for
payment in accordance with the terms of the exchange offer and
applicable law.
Of the shares tendered into the exchange offer, 19,132,243 shares made
an election to receive the mixed consideration, 3,000,559 shares made an
election to receive the all-cash consideration, and 47,934,021 shares
made an election to receive the all-stock consideration.
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Hatteras common stockholders who elected to receive the mixed
consideration or tendered without a valid election will receive the
mixed consideration, which consists of $5.55 in cash and 0.9894 shares
of Annaly common stock per share of Hatteras common stock;
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Hatteras common stockholders who elected to receive the all-cash
consideration will receive $15.85 in cash per share of Hatteras common
stock; and
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Hatteras common stockholders who elected to receive the all-stock
consideration will be subject to proration at a rate of approximately
69%, and will receive their consideration in the form of $15.85 in
cash for each share not accepted for the all-stock election due to
proration and 1.5226 shares of Annaly common stock per share of
Hatteras common stock for shares that were accepted for the all-stock
election.
Hatteras common stockholders will receive cash in lieu of fractional
shares of Annaly common stock.
Pursuant to the merger agreement, dated as of April 10, 2016, among
Annaly, Hatteras and Ridgeback Merger Sub Corporation, a wholly owned
subsidiary of Annaly (“Merger Sub”), Annaly intends to complete the
acquisition of Hatteras through a second-step merger of Hatteras with
and into Merger Sub without a vote of Hatteras’ stockholders, pursuant
to Section 3-106.1 of the Maryland General Corporation Law (the
“Merger”). In accordance with Maryland law, the Merger is expected to be
consummated on July 12, 2016. Upon consummation of the Merger, Hatteras
will become a wholly owned subsidiary of Annaly. In connection with the
Merger, all shares of Hatteras common stock not validly tendered into
the exchange offer will be cancelled and converted into the right to
receive merger consideration in the same amounts offered in the exchange
offer. Holders of these shares will have the opportunity to elect among
the mixed consideration, the all-cash consideration and the all-stock
consideration, subject to proration, as described in the
prospectus/offer to exchange, dated July 8, 2016, filed by Annaly with
the Securities and Exchange Commission in connection with the
transaction. In addition, upon consummation of the Merger, all of the
outstanding shares of Hatteras 7.625% Series A Cumulative Redeemable
Preferred Stock (the “Hatteras Series A Preferred Stock”) will be
cancelled and converted into the right to receive one newly issued share
of Annaly’s 7.625% Series E Cumulative Redeemable Preferred Stock, which
will have substantially the same terms as the existing terms of the
Hatteras Series A Preferred Stock.
As a result of the acquisition, shares of Hatteras common stock and
Hatteras Series A Preferred Stock will cease to be traded on the NYSE.
Wells Fargo Securities and Sandler O’Neill + Partners, L.P. are serving
as financial advisors to Annaly, and Wachtell, Lipton, Rosen & Katz
serves as legal counsel to Annaly.
About Annaly
Annaly’s principal business objectives are to generate net income for
distribution to its shareholders from its investments and capital
preservation. Annaly is a Maryland corporation that has elected to be
taxed as a real estate investment trust (“REIT”). Annaly is managed and
advised by Annaly Management Company LLC.
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, 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 financings; changes in the market value of our assets; changes in
business conditions and the general economy; our ability to grow our
commercial business; our ability to grow our residential mortgage credit
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; our ability to consummate any contemplated investment
opportunities; changes in government regulations affecting our business;
our ability to maintain our qualification as a REIT for federal income
tax purposes; our ability to maintain our exemption from registration
under the Investment Company Act of 1940, as amended; the timing to
consummate the Merger, and potential business disruption following the
acquisition of Hatteras. 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.
Additional Information and Where to Find It
This press release is for informational purposes only and is neither an
offer to purchase nor a solicitation of an offer to sell shares, nor is
it a substitute for the exchange offer materials that Annaly and its
merger subsidiary have filed with the Securities and Exchange Commission
(“SEC”). Annaly and its merger subsidiary have filed a tender offer
statement on Schedule TO, Annaly has filed a registration statement on
Form S-4, and Hatteras has filed a Solicitation/Recommendation Statement
on Schedule 14D-9 with the SEC with respect to the exchange offer. THE
EXCHANGE OFFER MATERIALS (INCLUDING AN OFFER TO EXCHANGE, A RELATED
LETTER OF TRANSMITTAL AND CERTAIN OTHER EXCHANGE OFFER DOCUMENTS) AND
THE SOLICITATION/RECOMMENDATION STATEMENT CONTAIN IMPORTANT INFORMATION.
HATTERAS SHAREHOLDERS ARE URGED TO READ THESE DOCUMENTS CAREFULLY
BECAUSE THEY CONTAIN IMPORTANT INFORMATION THAT HOLDERS OF HATTERAS
SECURITIES SHOULD CONSIDER BEFORE MAKING ANY DECISION REGARDING
EXCHANGING THEIR SECURITIES. The Offer to Exchange, the related Letter
of Transmittal and certain other exchange offer documents, as well as
the Solicitation/Recommendation Statement, are available to all holders
of Hatteras common stock at no expense to them. The exchange offer
materials and the Solicitation/Recommendation Statement are available
for free at the SEC’s website at www.sec.gov.
Additional copies may be obtained for free by contacting Annaly’s
Investor Relations department at 1-888-8Annaly (1-888-816-6159).
View source version on businesswire.com: http://www.businesswire.com/news/home/20160712005771/en/
Annaly Capital Management, Inc.
Investor Relations
1-888-8Annaly
www.annaly.com
Source: Annaly Capital Management, Inc.