New York Mortgage Trust Inc (NASDAQ:NYMT) Raises $109.9M To Acquire Distressed Residential Loan Properties


Dallas, Texas 04/10/2014 (FINANCIALSTRENDS) – New York Mortgage Trust Inc (NASDAQ:NYMT) announced in the first week of April that it has entered into a agreement with a consortium of financial banks including the likes of “UBS Securities LLC, Credit Suisse Securities (USA) LLC, Barclays Capital Inc. and RBC Capital Markets, LLC” to underwrite its offer to sale 13 million shares of the company’s common stock. The underwriters were also offered a 30 day option to buy an additional 1.95 million shares of common stock. The company closed the offer on 7th April.  From this exercise, the firm hopes to raise net proceeds of $109.9 million.

On 2nd April New York Mortgage Trust Inc (NASDAQ:NYMT) followed up its previous announcement, with the pricing of the shares on public offer at $7.59 per share. The firm had retained the services of Ladenburg Thalmann & Co. Inc., and Maxim Group LLC as co-managers for the offering. The real estate investment trust has indicated that it will use a major portion of the proceeds to buy out residential properties which are on the verge of being defaulted. The reminder of the proceeds would be used to increase its investments in loans to multifamily tenantments and for its general working capital.

The announcement of public offering by New York Mortgage Trust Inc (NASDAQ:NYMT) was predated by UBS initiating coverage of the stock with a buy rating. It had set a price target of $10 per share and had cited the likely increase in the rates regime as the reason for the bullishness about the stock .

Incidentally, in the first week of March, Deutsche Bank had downgraded the stock of this REIT to a Hold from previous Buy rating, by referring to the over valuation of the stock in context to its 4Q results. It had also upgraded the price target of the stock lightly to $7.75 from pervious $7.