Rithm Capital, the parent company of multichannel lender Newrez, announced on Tuesday that it has closed a transaction with Great Ajax Corp., which resulted in the purchase of 2.9 million shares of its peer’s common stock.
Rithm, a New York-based real estate investment trust, has invested in becoming a global asset management firm focused on real estate, credit and financial services. Meanwhile, Great Ajax is transitioning from a legacy residential loan platform to a vehicle focused on commercial real estate.
As a result of the transaction, an affiliate of Rithm will serve as the external manager of Great Ajax, replacing Thetis Asset Management LLC.
According to an announcement in February, a Rithm subsidiary was set to issue $70 million through a one-year term loan agreement to Great Ajax for the payment of the company’s outstanding convertible notes. The companies also previously noted that Great Ajax will issue five-year warrants to Rithm, exercisable for its common stock, based on the amounts drawn under the loan facility.
Michael Nierenberg, chairman, CEO and president of Rithm Capital, said in a statement that the company continues to invest in the “strategic growth of our global asset management platform.”
In 2023, Rithm acquired Sculptor Capital Management, along with Computershare Mortgage Services and Specialized Loan Servicing (SLS). Earlier this year, Rithm restructured its distributed retail business due to a shrinking mortgage market, cutting managers and reducing compensation at Newrez, a top-10 mortgage lender and servicer. It’s also cutting jobs at Computershare and SLS.
“We believe this transaction positions Great Ajax to pursue a focused commercial real estate investment strategy that will unlock value for stockholders,” Nierenberg added.
The transaction also included Rithm’s purchase of 2.9 million shares of Great Ajax common stock. Rithm had previously announced the acquisition of $14 million in Great Ajax common stock.
Citi was Rithm’s financial adviser on the deal, while Piper Sandler & Co. advised Great Ajax. Great Ajax stockholders approved the deal on May 20.
