The two struggling mortgage REITs share the same external manager, so the transaction isn't as exciting as it otherwise might be. Jeff Zimmer and Scott Ulm are co-CEOs and co-vice chairmen of both.
Under the terms of the deal, Armour (NYSE:ARR) will tender to acquire all of Javelin (NYSE:JMI) for a cash amount equal to 87% of book value. Based on JMI's estimated book value as of March 1, the price would be $7.14 per share vs. last night's close of $6.
The deal will bring Javelin's portfolio of non-agency MBS onto the Armour balance sheet (filled with agency MBS).