Annaly Capital Management Tuesday morning said it would raise almost $1.3 billion in new equity by selling 75 million shares of common at an offering price of $17.20 each.
The equity raised by the publicly traded REIT comes as the mortgage market is on the threshold of what could prove to be a historic restructuring with some analysts predicting that REITs could emerge as big winners because they are not regulated by any federal banking agencies.
The New York based firm said it will use the money to buy MBS in the open market. It also may pay down debt.
Annaly's core business entails buying MBS issued by Fannie Mae, Freddie Mac and the Federal Home Loan Bank system.
As part of the stock offering, the New York-based firm granted its underwriters a 30-day option to purchase up to an additional 11.25 million shares of common to cover overallotments.
Credit Suisse Securities is the lead book-running manager on the deal. Barclays Capital Inc., J.P. Morgan Securities LLC and RCap Securities, Inc. are book-running managers.
