Colony Financial: Too Volatile For A 6.5% Yield
Stone Fox Capital
Stone Fox Capital
Colony Financial: Turning Distress Into Income
Tue, Jun. 7, 3:01 PM
- The combination of NorthStar Realty Finance (NYSE:NRF), NorthStar Asset Management (NYSE:NSAM), and Colony Capital (NYSE:CLNY) is likely to result in an entity with a significantly higher debt-to-adjusted EBITDA ratio than what NSAM currently sports (less than 1.5x), says S&P.
- The current BBB- rating could be cut by one or more notches. For now, S&P will keep things on watch, and resolve the rating once the deal is completed (expected Q1 2017).
Fri, Jun. 3, 7:23 AM
- Upon completion of the all-stock deal, NorthStar Asset Management (NYSE:NSAM) shareholders will own 32.25% of the new Colony NorthStar, Colony Capital (NYSE:CLNY) shareholders will own 33.25%, and NorthStar Realty Finance (NYSE:NRF) shareholders 33.9%.
- NSAM owners, in addition to the regular quarterly dividend, will receive a special cash dividend of $128M.
- Colony's Thomas Barrack will be Executive Chairman of the board, NorthStar's David Hamamoto will be Executive Vice Chairman, and Colony's Richard Saltzman will be CEO.
- The companies expect about $115M in annual cost savings, $80M in cash and $35M in stock-based compensation.
- Terms: NSAM shareholders will own one share of the new company for each share of NSAM they hold; Colony shareholders will receive 1.4663 shares of the new company stock for each share of CLNY they hold; NRF shareholders will receive 1.0996 shares of the new company stock for each share of NRF they hold.
- Closing is expected in Q1 of next year.
- A conference call is set for 10 ET.
- Source: Press Release
Fri, May 6, 4:19 PM
- After a week of sleepy trading, NorthStar Asset Management (NYSE:NSAM) has leapt 16% after hours on news that Colony Capital (NYSE:CLNY) may be close to a deal to acquire it.
- That deal may come by way of partnering with NorthStar Realty Finance (NYSE:NRF), according to chatter.
- NorthStar Asset Management has been under activist pressure this year and formed a special committee in March to examine alternatives including a recombination with NorthStar Realty Finance.
- NSAM was spun off from NRF in 2013.
- Now read NorthStar Realty Finance - NorthStar Realty Europe Spin: Buy, Sell Or Hold After Q4 Earnings? »
Wed, Jan. 6, 7:46 AM
- Alongside the merger is the internalization of Starwood Waypoint's (NYSE:SWAY) manager. The name of the company is now Colony Starwood Homes, and the ticker has been changed from SWAY to SFR.
- Combined, the two have a NAV of about $7.7B and more than 30K homes concentrated in their top 10 markets.
- Formerly president and COO of Colony American Homes, Fred Tuomi is CEO of the merged company, with Colony CFO Arik Prawer the CFO. Formerly COO of Statwood Waypoint, Charles Young is COO of the merged company.
- Barry Sternlicht and Thomas Barrack (NYSE:CLNY) are co-chairmen of the board.
- The company expects to realized synergies of about $50M annually, and expects to achieve 70% of that by the end of Q1 and 100% by the end of next year.
Sep. 21, 2015, 10:18 AM
- Starwood Waypoint (SWAY +9.3%) is sharply higher after announcing its merger with Colony Capital's (CLNY +2.7%) Colony American Homes.
- With M&A (and the quick scale-up and cost savings that come with it) in the air, Silver Bay Realty (SBY +1.7%), American Homes 4 Rent (AMH +2.6%), and American Residential Properties (ARPI +2.2%) are also on the move.
Sep. 21, 2015, 7:37 AM
- Unable to pull off an IPO of its single-family rental operation, Colony Capital (NYSE:CLNY) engineers a pseudo-IPO by merging Colony American Homes with Starwood Waypoint (NYSE:SWAY).
- CAH shareholders will receive 64.9M shares of SWAY in exchange for 100% of the stock of CAH. After the deal, CAH shareholders will own about 59% of the combined company's shares. The $0.19 dividend is expected to be maintained.
- Barry Sternlicht and Thomas Barrack will serve as non-executive co-chairmen of the board, while President and COO of CAH Fred Tuomi will be CEO. SWAY CEO Doug Brien will be president and COO.
- The combined company will own and manage (management will be internalized as part of the merger) more than 30K homes with a total asset value of $7.7B. The deal is expected to achieve annualized cost savings of $40M-$50M.
- A conference call is set for 9 ET
Colony Capital, Inc. operates as a real estate investment and finance company. It acquires, originates and manages a portfolio of real estate-related debt instruments. It focuses on acquiring, originating and managing commercial mortgage loans, which may be performing, sub-performing or... More
Industry: REIT - Diversified
Country: United States
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