Cherry Hill Mortgage Investment Corp. plans to "explore strategic alternatives," which could result in a
The board of directors at the Farmingdale, New Jersey-based real estate investment trust will establish a committee to look at a full range of options aimed at maximizing shareholder value. Among alternatives being explored are a merger, sales of all or part of the company's assets or "an internalization of the management of the company," Cherry Hill said in a press release.
The special committee will consist of independent and disinterested directors and intends to consider all potential opportunities, the company noted. Guggenheim Advisors is providing financial guidance and expertise to the committee.
"There can be no assurance that the exploration of strategic alternatives will result in any transaction or other strategic outcome," Cherry Hill said. No timeline for a final outcome was established, nor will developments be disclosed until evaluation has been completed or the committee deems it necessary.
The REIT, which was originally launched as a publicly traded company in 2013 through a strategic alliance partnership
Since its inception, the company has been led by CEO and President Jay Lown, who also sits on the board of directors. Also currently serving as independent directors on the Cherry Hill board are Sharon Lee Cook, Robert Mercer Jr. and Joseph Murin.
After closing at $3.30 on Friday, shares of Cherry Hill stock initially spiked in pre-market activity following the announcement, before opening at $3.38 on Monday. The stock's value rose to $3.50 by midday. Over the past 12 months, the closing price has fluctuated between $2.77 and $5.53, which it hit almost a year ago.
At the end of 2023, the company held $20 billion worth of unpaid balances within its
The latest announcement from Cherry Hill comes during a prolonged stretch of consolidation within the mortgage industry, as it attempts to rightsize in response to slowing lending activity. While many of the deals have involved originators and technology firms, the REIT segment has also figured into deals, including a merger
Cherry Hill is not the only REIT exploring a restructuring. Rithm Capital, parent company of residential lender Newrez, filed necessary paperwork for a
Like any potential future move at Cherry Hill, the proposed change was aimed at increasing shareholder value, Rithm leaders said at the time. But the company has also actively shifted some of its focus over the past several months to establish itself as an alternative asset manager.
