CCM to issue $500M in senior notes as Two Harbors deal nears closing

CrossCountry Intermediate Holdco (CCM) is expected to issue $500 million of senior unsecured notes, coinciding with the projected August closing of its Two Harbors Investment Corp. acquisition. Fitch Ratings said it expects to rate the issuance at ‘BB-(EXP)’, ranking pari passu with existing senior unsecured debt. Proceeds are expected to be used to repay mortgage servicing rights (MSR)-backed facilities that will be drawn to fund the transaction. The credit ratings agency estimates corporate leverage for CCM will increase to 2.4x after the acquisition, up from 1.2x in the second quarter of 2026 and exceeding its downgrade trigger of 1.5x. “However, retained earnings growth should reduce leverage toward the company’s 1.0x target over the medium term,” Fitch said. “Negative rating action could result from an inability to reduce corporate leverage to 1.5x or below over the rating outlook horizon.” Analysts expected CCM to raise debt to proceed with the Two Harbors deal, valued at $1.26 billion, flagging rising leverage as an integration challenge as well as the complex task of bringing a large servicing portfolio in-house. A shift from secured to unsecured debt, however, is viewed as...