Granite Point Mortgage Trust priced its initial public offering at $19.50 per share, which was below the $20 to $21 range the company expected.
The company is selling 10 million shares, with an option for the underwriters to purchase an additional 1.5 million shares.
Net proceeds will total $181.3 million and will be used by Granite Point to acquire commercial mortgage loans and other commercial real estate debt.
Granite Point was created by Two Harbors Investment Corp. as the exit strategy for its commercial lending business. Two Harbors is contributing $1.8 million of commercial real estate assets, related secured indebtedness of $1.2 billion and working capital of $100 million, according to a Securities and Exchange Commission filing.
In return, Two Harbors receives 33.1 million shares of Granite Point common stock. After a 120-day lock-up period expires, those shares are being distributed to Two Harbors' shareholders as a special dividend. Two Harbors also agreed to purchase up to $20 million of Granite Point common stock on the open market; these shares are not being distributed as part of the special dividend.