7.1% Stake of RAIT Financial Trust (RAS) Owned by Tiptree Inc.
stated that they own a 7.1% stake in RAIT Financial Trust (NYSE:RAS) in a Schedule 13D/A disclosure that was filed with the SEC on Tuesday, September 19th. The investor owns 6,622,380 shares of the stock worth approximately $4,054,221. The disclosure is available through the SEC website at this link.
provided the following explanation of their ownership:
Item 4 of the Amended 13D is hereby amended and supplemented by adding the following information:
On September 18,2017, Tiptree and the Issuer entered into a mutual confidentiality agreement (the “Confidentiality Agreement”). Under the Confidentiality Agreement, Tiptree and the Issuer agreed, among other things, to a customary mutual nondisclosure agreement governing the exchange of confidential information between Tiptree and the Issuer and a “standstill provision” (the “Standstill Provision”) for a period of 18 months from the date of the Confidentiality Agreement (the “Standstill Period”).
The Standstill Provision provides that unless specifically invited in writing by the Board of Trustees of the Issuer, Tiptree will not, among other things, directly or indirectly effect or publicly seek to effect (i) any acquisition of the Issuers securities, rights or options to acquire any securities (or beneficial ownership thereof), or any material assets, indebtedness or businesses of the Issuer, (ii) any tender or exchange offer, merger, consolidation or other business combination involving the Issuer, (iii) any recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the Issuer or (iv) any solicitation of proxies or consents to vote any voting securities of the Issuer; or otherwise seek to control or influence management or the Board of Trustees of the Issuer, or assist or encourage any third parties to do the same or publicly disclose any intention, plan or arrangement related to the same. Furthermore, Tiptree agrees during the Standstill Period not to request that the Issuer amend, waive or terminate the Standstill Provision.
The Standstill Provision becomes inoperative and of no force or effect if a third party engages the Issuer in a Competing Transaction, defined in the Confidentiality Agreement as a transaction whereby a person, other than Tiptree or the Issuer: (i) enters into an agreement providing for the merger or consolidation, or any similar transaction, involving the Issuer in which, following consummation of such transaction, substantially all of the persons who, immediately prior to such transaction, had beneficial ownership of 50% or more of the voting power of the Issuer do not continue to beneficially own at least 50% of the voting power of the combined entity and do not have the ability to elect a majority of the directors or trustees, as applicable, of
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the combined entity, (ii) enters into an agreement providing for the purchase or other acquisition of, or purchases or otherwise acquires, more than 50% of the assets of the Issuer, (iii) enters into an agreement providing for the purchase or other acquisition of, or purchases or otherwise acquires, beneficial ownership of securities representing 50% or more of the voting power of the Issuer or (iv) makes a public offer or proposal (including a tender or exchange offer) that, if consummated, would result in a Competing Transaction, and the Board of Trustees of the Issuer does not publicly recommend against such offer within 10 business days after the public announcement of such offer or proposal.
The Confidentiality Agreement has a termination date of March 18,2019 unless terminated earlier upon mutual consent or the execution of a definitive transaction agreement that supersedes the Confidentiality Agreement.
The foregoing description of the Confidentiality Agreement, including descriptions of the Standstill Provision, is qualified in its entirety by reference to the full text of the Confidentiality Agreement, which is attached as Exhibit 99.1 hereto.
Other institutional investors have also recently added to or reduced their stakes in the company. Bank of America Corp DE grew its position in RAIT Financial Trust by 128.0% in the first quarter. Bank of America Corp DE now owns 32,861 shares of the real estate investment trust’s stock worth $105,000 after acquiring an additional 18,448 shares in the last quarter. SG Americas Securities LLC purchased a new position in RAIT Financial Trust in the first quarter worth $133,000. American International Group Inc. grew its position in RAIT Financial Trust by 7.0% in the first quarter. American International Group Inc. now owns 56,509 shares of the real estate investment trust’s stock worth $181,000 after acquiring an additional 3,707 shares in the last quarter. Tudor Investment Corp ET AL grew its position in RAIT Financial Trust by 112.8% in the second quarter. Tudor Investment Corp ET AL now owns 57,888 shares of the real estate investment trust’s stock worth $127,000 after acquiring an additional 30,685 shares in the last quarter. Finally, Metropolitan Life Insurance Co. NY grew its position in RAIT Financial Trust by 14.6% in the first quarter. Metropolitan Life Insurance Co. NY now owns 60,290 shares of the real estate investment trust’s stock worth $193,000 after acquiring an additional 7,677 shares in the last quarter. 59.89% of the stock is currently owned by hedge funds and other institutional investors.
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Shares of RAIT Financial Trust (RAS) traded down 6.9888% on Tuesday, reaching $0.6122. 2,257,441 shares of the company traded hands. RAIT Financial Trust has a 1-year low of $0.52 and a 1-year high of $3.91. The stock has a 50-day moving average price of $1.07 and a 200 day moving average price of $2.18. The firm’s market capitalization is $57.00 million.
RAIT Financial Trust (NYSE:RAS) last announced its quarterly earnings results on Tuesday, August 8th. The real estate investment trust reported ($0.04) earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.04 by ($0.08). The company had revenue of $22.81 million during the quarter, compared to the consensus estimate of $28.78 million. RAIT Financial Trust had a negative net margin of 99.46% and a positive return on equity of 0.98%. Analysts anticipate that RAIT Financial Trust will post ($1.84) EPS for the current fiscal year.
The business also recently declared a quarterly dividend, which was paid on Friday, September 15th. Shareholders of record on Friday, August 25th were issued a $0.05 dividend. The ex-dividend date was Wednesday, August 23rd. This represents a $0.20 dividend on an annualized basis and a yield of 32.67%. RAIT Financial Trust’s dividend payout ratio is currently -12.99%.
Several research analysts recently issued reports on the stock. Zacks Investment Research lowered shares of RAIT Financial Trust from a “buy” rating to a “hold” rating in a research report on Wednesday, July 12th. JMP Securities lowered shares of RAIT Financial Trust from a “market perform” rating to an “underperform” rating in a research report on Wednesday, August 9th. FBR & Co lowered shares of RAIT Financial Trust from a “buy” rating to a “neutral” rating and cut their target price for the stock from $3.00 to $1.25 in a research report on Tuesday, August 15th. Deutsche Bank AG cut their target price on shares of RAIT Financial Trust from $2.75 to $1.60 and set a “hold” rating for the company in a research report on Tuesday, August 15th. Finally, ValuEngine lowered shares of RAIT Financial Trust from a “buy” rating to a “hold” rating in a research report on Friday, September 1st. Two investment analysts have rated the stock with a sell rating and three have assigned a hold rating to the company. The stock currently has an average rating of “Hold” and a consensus target price of $1.78.
RAIT Financial Trust Profile
RAIT Financial Trust (RAIT) is a real estate investment trust (REIT). The Company focuses on providing commercial real estate (CRE) financing throughout the United States. The core of its business is a full service CRE lending platform focused on first lien loans. It offers customized lending solutions to meet borrower needs and internal credit goals.
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