Angel Oak Mortgage, a mortgage REIT focused on non-qualified loans, announced terms for its IPO on Tuesday.
The Atlanta, GA-based company plans to raise $165 million by offering 8.1 million shares at a price range of $20 to $21. New investor the Canada Pension Plan Investment Board has agreed to purchase $40 million worth of shares in a concurrent private placement. At the midpoint of the proposed range, Angel Oak Mortgage would command a market value of $537 million.
Angel Oak Mortgage invests primarily in newly-originated first lien loans made to higher-quality non-QM (non-qualified mortgage) borrowers. The company's loans are primarily sourced from Angel Oak's proprietary mortgage lending platform and are managed by Falcons I, an affiliate of Angel Oak Capital Advisors, Angel Oak Mortgage Lending, and had total assets of $535 million and a non-QM loan portfolio of $481 million as of March 31, 2021. Angel Oak Mortgage's loan portfolio had a FICO score of 715 and a weighted average LTV ratio of 76%.
The company did not disclose a proposed yield; in the 1Q21 it generated $0.31 in pro forma distributable EPS, compared to $0.18 during its fiscal 2020.
Angel Oak Mortgage was founded in 2018 and booked $36 million in sales for the 12 months ended March 31, 2021. It plans to list on the NYSE under the symbol AOMR. Wells Fargo Securities, BofA Securities, Morgan Stanley, UBS Investment Bank, and B. Riley Securities are the joint bookrunners on the deal.
