Five Oaks Investment Corp. (NYSE: OAKS) is having an overwhelmingly strong day in the market today, and for good reason. The company announced that it has entered into a new management agreement and shift in directions. Today, we’ll talk about the news, what we’re seeing from the stock, and what we’ll be watching for with regard to OAKS ahead.
OAKS Gains On Strategic Update
As mentioned above, Five Oaks Investment Corp. is having a strong day in the market today after announcing that its independent directors have unanimously approved the entry into a new management agreement with Hunt Investment Management, LLC. Hunt Investment Management, LLC is a subsidiary of Hunt Companies, Inc.
Along with the announcement of a new management agreement, OAKS announced the concurrent mutual termination of its management agreement with Oak Circle Capital Partners LLC.
In the release, OAKS said that management by Hunt is expected to provide the company with a new strategic direction as a result of the reallocation of capital into new investment opportunities. In particular, these opportunities will be focused in the commercial real estate mortgage space.
In the PR, Five Oaks Investment Corp also announced that as part of this transaction, an affiliate of Hunt purchased 1,539,406 shares of OAKS common stock in a private placement by the company. These shares were purchased at a price of $4.77 per share, resulting in $7,342,966.62 in capital raised.
Also, as part of this transaction, OAKS announced that David Carroll has resigned as a director, Chairman and CEO of the company. The company’s Board has appointed James C. Hunt as a director and Chairman of the board. The board has also named James P. Flynn as CEO of OAKS and Michael P. Larsen as President of the company. In a statement, Chris Hunt, CEO of Hunt, had the following to offer:
“I look forward to joining the Five Oaks Board and working with the Company to help build value for all stockholders. I believe that our investment today in Five Oaks demonstrates our belief in the platform and future success of the Company and aligns the interests of Hunt as external manager with those of the stockholders of Five Oaks as we seek to grow the Company in the coming years.”
What We’re Seeing From The Stock
As investors, one of the first things that we learn is that the news moves the market. Today’s news surrounding Five Oaks Investment Corp. proved to be overwhelmingly positive as the company takes a large shift in directions. As a result, we’re seeing strong gains in the value of the stock. Of course, our partners at Trade Ideas were the first to alert us to the gains. Currently (11:43), OAKS is trading at $3.75 per share after a gain of $0.70 per share or 22.95% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on OAKS. In particular, we’re interested in following the growth of the company as it shifts both management and strategic direction. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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