Why Sculptor Capital Shares Are Rocketing Today

Sculptor Capital Management Inc SCU shares are trading higher by around 16% after it disclosed its acquisition by Rithm Capital Corp RITM.

Rithm inked a deal to acquire Sculptor Capital for around $639 million.

Sculptor Class A shareholders will receive cash consideration equal to $11.15 per share, with Sculptor operating partnership unitholders receiving the applicable amount per the Sculptor partnership agreement.

The price represents a premium of 18% over the closing price of Sculptor's Class A shares on July 21, 2023, and a premium of 31% over the unaffected November 17, 2022 closing Class A share price of $8.50.

RITM expects the acquisition impact to be neutral on its 2024 earnings and accretive in 2025. 

The transaction is expected to close in Q4 2023, subject to customary closing conditions.

Upon transaction closure, Sculptor's investment and leadership teams will continue in their roles and operate as a subsidiary of RITM.

"This transaction is transformational for Rithm. Sculptor's $34 billion of AUM coupled with Rithm's $7bn of permanent equity capital and $30+ billion balance sheet creates a world-class asset management business. We are very excited to bring together two organizations with strong track records, excellent management teams, and seasoned investment professionals," said Michael Nierenberg, Chairman, CEO, and President. 

RITM expects to fund the transaction with cash on hand and held cash and equivalents of $1.8 billion.

Also Read: Rithm Capital Buys $1.4B Of Marcus Loans From Goldman Sachs

Price Action: SCU shares are up 16.24% at $10.95 premarket on the last check Monday.