Ready Capital Corporation · NYSE:RC
Ready Capital — Merger or Acquisition (February 2023)
22 slides from Ready Capital's merger presentation, Feb 27, 2023
Slide 1: Ready Capital and Broadmark Realty Capital Announce Definitive Merger Agreement
READY CAPITAL AND BROADMARK REALTY CAPITAL ANNOUNCE DEFINITIVE MERGER AGREEMENT February 27, 2023
Slide 2: Disclaimer
Disclaimer These materials and any presentation of which they form a part are neither an offer to sell, nor a solicitation of an offer to purchase, an interest in Ready Capital Corporation (“Ready Capital,” “RC,” or the “Company”). Neither the Company nor any of its representatives or affiliates mak
Slide 3: Agenda
Agenda I. Ready Capital and Waterfall Asset Management Overview II. Broadmark Realty Capital Inc. Overview III. Transaction Summary and Benefits to Stakeholders
Slide 4: Ready Capital and Waterfall Asset Management Overview
Ready Capital and Waterfall Asset Management Overview
Slide 5: Overview of Ready Capital Corporation
Overview of Ready Capital Corporation Overview of Ready Capital Key Statistics2 • Ready Capital Corporation (NYSE: RC) (“Ready Capital”) is a multi- $11,621 million $1,890 million strategy real estate finance company that acquires, originates and Total Assets Total Equity services lower-to-middle ma
Slide 6: Waterfall – A Successful & Proven Asset Manager
Waterfall – A Successful & Proven Asset Manager Global alternative asset manager that employs a differentiated relative value approach across structured credit, whole loans, CRE equity and private equity strategies Overview of Waterfall Investment Strategy Gross Asset Value (“GAV”) Ready Capital EST
Slide 7: Broadmark Realty Capital Inc. Overview
Broadmark Realty Capital Inc. Overview
Slide 8: Overview of Broadmark Realty Capital, Inc.
Overview of Broadmark Realty Capital, Inc. Broadmark Realty Capital, Inc. (NYSE:BRMK) (“Broadmark”) is specialty real estate finance company that specializes in originating and servicing residential and commercial construction loans Company Overview Company Highlights • Founded in 2010, Broadmark ma
Slide 9: Broadmark's Financial Highlights
Broadmark’s Financial Highlights Diversified loan portfolio with attractive unlevered yields, industry-leading balance sheet, and strong liquidity to support growth in all economic cycles Strong Double-Digit Strong High Quality Capitalization Unlevered Yields Liquidity Assets Structure $100MM 10.2%
Slide 10: Summary of Broadmark's Portfolio
Summary of Broadmark’s Portfolio Active Portfolio Metrics Portfolio % by Property Type1 Portfolio % by Loan Purpose1 Land Entitlement Bridge Raw Land 2% Acquisition Total Commitment $1.4 billion 9% 2% Rehabilitation 1% Horizontal 3% Development Investment Number of Active Loans 202 10% 3% For Sale R
Slide 11: Transaction Summary and Benefits to Stakeholders
Transaction Summary and Benefits to Stakeholders
Slide 12: Transaction Summary
Transaction Summary • Stock-for-stock merger between Ready Capital Corporation (NYSE: RC) and Broadmark Realty Capital Inc. Transaction Summary (NYSE: BRMK) • BRMK shareholders will receive stock consideration based on a fixed exchange ratio of 0.47233 • Implied consideration of approximately $787 m
Slide 13: Strategic Combination between RC and BRMK
1 2 3 4 5 Strategic Combination between RC and BRMK Opportunity to create a leading non-bank lender to the lower and middle CRE market and the 4th largest commercial mortgage REIT with total equity capitalization of ~$2.8 billion Highly Synergistic Business Models with Natural Alignment Across Geogr
Slide 14: Highly Synergistic Business Models
1 2 3 4 5 Highly Synergistic Business Models Combined franchise will leverage geography, product, credit, and ESG alignments to enhance growth and returns across macro and rate cycles. Ability for the combined company to capture economics throughout the full lifecycle of a property and retain sponso
Slide 15: Highly Synergistic Business Models (Cont'd)
1 2 3 4 5 Highly Synergistic Business Models (Cont’d) Geographic Overlap Complementary Products Geography Competitive Landscape • Complementary geographic footprints • RC and BRMK are both focused on lower- Tax Exempt to-middle market lending Funding • Combination creates a national footprint capabl
Slide 16: Strategically & Financially Compelling
1 2 3 4 5 Strategically & Financially Compelling Benefits to Ready Capital Stakeholders Benefits to Broadmark Stakeholders ✓• Synergistic franchises enhance the combined business model and return profile ✓ • Significant premium to existing share price 1 (approximately 41% based on closing share pric
Slide 17: Robust Liquidity Supported by Diversified Access to Funding
1 2 3 4 5 Robust Liquidity Supported by Diversified Access to Funding Transaction provides access to a largely unencumbered portfolio and liquid balance sheet, which is supported by proven asset management and capital markets capabilities. Combined company will seek to optimize the balance sheet thr
Slide 18: Significantly Enhanced Scale
1 2 3 4 5 Significantly Enhanced Scale Pro-Forma Equity Base ($ in billions) $6.8 $4.5 Combined Equity of $2.8B1 $3.1 $2.8 $2.5 $2.4 $1.9 $1.6 $1.6 $1.5 $1.4 $1.3 $0.9 $0.7 STWD BXMT ABR Combined CMTG ARI RC FBRT KREF LADR BRSP TRTX BRMK ACRE Note: Financial data as of most recently reported period.
Slide 19: Operational Leverage
1 2 3 4 5 Operational Leverage A combination of Ready Capital & Broadmark leads to significant value creation for shareholders via both economic and operational leverage associated with the combined business • Leverage Waterfall’s capital • Ability to leverage external markets, legal, investment man
Slide 20: Proven Acquisition and Integration Track Record
1 2 3 4 5 Proven Acquisition and Integration Track Record Ready Capital is among the most active and successful acquirers in the MREIT sector, having completed six transactions since 2016, including three public company mergers Announcement October 31, 2016 November 8, 2018 October 31, 2019 December
Slide 21: Generation of Shareholder Value
1 2 3 4 5 Generation of Shareholder Value The transaction provides additional scale, capital, and capabilities to continue the execution of Ready Capital’s differentiated commercial real estate lending strategy that has been successfully built in large part due successful acquisitions Total Return S
Slide 22: SEEDS READY
SEEDS READY RC LISTED NYSE EES. CAPITAL.
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