UWM Holdings to acquire Two Harbors in $1.3B all-stock transaction

UWM Holdings (UWMC) and Two Harbors (TWO) announced that they have entered into a definitive merger agreement pursuant to which UWM will acquire Two in an all-stock transaction for $1.3B in equity value, based on a fixed exchange ratio of 2.3328x. The transaction will materially increase UWM’s public float to approximately 513M shares, or $2.6B based on the price of UWMC common stock on December 16, representing a 93% increase from UWMC’s current float. Under the terms of the agreement, Two stockholders will receive a fixed exchange ratio of 2.3328 shares of UWMC Class A common stock for each share of Two common stock. This represents an $11.94 per share value based on UWMC’s closing price as of December 16 and a premium of 21% the volume weighted average price of TWO’s common stock for the 30 days ending December 16. Upon completion of the transaction, UWM shareholders will own approximately 87% of the combined company on a pro forma fully diluted basis, while Two shareholders will own approximately 13%. The all-stock transaction is intended to be tax-free to Two’s stockholders. The board of the combined company is expected to expand to eleven directors through the addition of one additional director designated by Two. The transaction has been unanimously approved by the boards of directors of both UWMC and Two. The transaction is expected to close in the second quarter of 2026, subject to approval of Two’s stockholders and the satisfaction of other closing conditions, including customary regulatory approvals.