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CCM plans $500M senior notes ahead of Two Harbors deal close
Fitch expects the new notes to be rated BB-(EXP) and says proceeds will likely repay MSR-backed facilities, with leverage projected to rise to 2.4x after the acquisition.
CrossCountry Intermediate Holdco (CCM) is expected to issue $500 million of senior unsecured notes as it nears the projected August closing of its acquisition of Two Harbors Investment Corp., HousingWire reports. Fitch Ratings expects to rate the notes BB-(EXP), pari passu with existing senior unsecured debt.
Fitch said the issuance proceeds are likely to repay mortgage servicing rights, or MSR, backed facilities that CCM plans to draw to fund the transaction. The credit ratings agency estimates CCMs corporate leverage will increase to 2.4x after the deal, up from 1.2x in the second quarter of 2026, surpassing a downgrade trigger of 1.5x.
Fitch added that retained earnings growth should help reduce leverage toward CCMs 1.0x target over the medium term. It warned that negative rating action could occur if CCM cannot reduce leverage to 1.5x or below within the rating outlook horizon.
The Two Harbors deal is valued at $1.26 billion and would add a $159 billion servicing portfolio to CCMs $202 billion portfolio, according to Inside Mortgage Finance cited by HousingWire. Two Harbors would move CCM up to No. 8 among the largest servicers by owned portfolios, and the combined company is expected to benefit from higher recurring servicing cash flows and synergy opportunities.