Anworth Sends Letter To Stockholders

                     Anworth Sends Letter To Stockholders  Urges Stockholders to Vote WHITE Proxy Card Today "FOR" All Six of the Company's Director Nominees  PR Newswire  SANTA MONICA, Calif., April 30, 2014  SANTA MONICA, Calif., April 30, 2014 /PRNewswire/ --Anworth Mortgage Asset Corporation (NYSE: ANH) today announced that it mailed on April 28, 2014 and filed with the Securities and Exchange Commission on such date, a letter to stockholders in connection with the 2014 Annual Meeting of Stockholders scheduled for May 22, 2014.  The Anworth Board of Directors unanimously recommends that stockholders sign, date and return the WHITE proxy card and discard any materials they may receive from Western Investment, LLC.  The full text of the letter follows:  YOUR INVESTMENT IS AT RISK  AN ACTIVIST HEDGE FUND, WESTERN INVESTMENT LLC, WANTS CONTROL OF YOUR BOARD. WESTERN IS FOCUSED ON LIQUIDATING YOUR COMPANY AND TERMINATING YOUR INVESTMENT, INSTEAD OF BUILDING LONG-TERM VALUE AND RETURNS.  DO NOT GIVE CONTROL OF YOUR BOARD TO WESTERN. VOTE THE ENCLOSED WHITE PROXY CARD TODAY AND PROTECT YOUR INCOME AND YOUR INVESTMENT.  April 28, 2014  Dear Stockholders:  At the 2014 Annual Meeting of Stockholders on May 22, 2014, you will have the opportunity to make an extremely important decision regarding the future of your investment in Anworth. You can protect your investment by voting today the enclosed WHITE proxy card "FOR" all six of your Company's director nominees: Lloyd McAdams, Lee A. Ault III, Joe E. Davis, Robert C. Davis, Joseph E. McAdams and Mark S. Maron.  Since Anworth went public more than 16 years ago, despite several stock market corrections, the worst recession in decades and a volatile interest rate environment, your directors' investment strategy has generated long-term growth and returns of 267% to its stockholders and, so far in 2014, Anworth's stock price has increased approximately 30%. Your Board is focused on creating long-term value and increasing the returns on your investment.  WESTERN IS ATTEMPTING TO OBTAIN CONTROL OF YOUR BOARD WITHOUT PAYING YOU ANYTHING TODAY  Western acquired its 4.0% stake in Anworth during just the past four months. Western wants control of your Board without paying you a control premium, or anything, today, and without proposing any specific growth plan or operating strategy. We believe Western is focused only on its own short-term trading gains, rather than creating long-term value and income for Anworth and all of its stockholders.  Your vote is critical no matter how many shares you own! Please vote today only the enclosed WHITE proxy card "FOR" all six of your Board's director nominees. It is extremely important that you disregard the gold proxy card you may already have received or will receive from Western. To vote "FOR" your Board's six director nominees, you should complete, sign, date and return ONLY the WHITE proxy card. Do not send back a gold proxy card. Do not hand Western control of your Board.  YOUR BOARD HAS CREATED LONG-TERM VALUE AND MARKET-BEATING RETURNS FOR ANWORTH'S STOCKHOLDERS    oSince Anworth's IPO, Our Investment Strategy Has Generated Long-Term     Returns on Investment That Have Outperformed Industry and Leading U.S.     Stock Indices. Over this 16-year, post-IPO period, the total cumulative     return on an investment in Anworth's common stock (including reinvested     dividends) has been approximately 267%; an 8.4% compounded annual return.     Over this period, our returns have significantly exceeded the FTSE NAREIT     Mortgage-REIT Index and major U.S. stock indices.1   oWe Have Generated Significant Returns During the Past Five Years     Notwithstanding Adverse Market Conditions. Your Board's hedged investment     strategy, which it successfully executed during one of the most     challenging stock market environments and prolonged economic recessions in     history, has produced a cumulative return on investment (including     reinvested dividends) of 68.5% over the past five years; an 11.0%     compounded annual return.   oOutstanding Stock Price Appreciation in 2014. Anworth's stock price has     increased approximately 30% so far this year. Giving effect to the     dividend payable to you on April 29, 2014, the total return of your     investment in Anworth in 2014 has been approximately 34% in less than four     months.  YOUR BOARD IS TAKING SIGNIFICANT ACTION TO CREATE LONG-TERM VALUE AND INCREASE YOUR INVESTMENT RETURNS    oWe recently  increased the quarterly cash dividend on Anworth's common     stock to 14 cents per share; constituting an annualized dividend yield of     10.2%.   oWe recently increased Anworth's on-going share repurchase program by     10,000,000 shares. During the first quarter of 2014 Anworth repurchased     5,364,414 shares, and during the year ended December 31, 2013 Anworth     repurchased 7,646,429 shares. Because we repurchased these shares  at a     discount, we created an increase in Anworth's net book value of     approximately $0.12 per share; constituting an aggregate increase of     approximately $16 million.   oWe recently announced a diversification strategy to position your Company     for increased future growth and investment returns.   oWe nominated Mark S. Maron, a new independent director with significant     real estate finance and capital markets experience, for election at the     2014 Annual Meeting.   oWe formed an independent Strategic Review Committee to assist with the     execution of our investment diversification strategy and explore long-term     value enhancement opportunities.   oWe engaged Credit Suisse to identify specific transactions to execute our     diversification strategy and to make recommendations regarding potential     capital markets transactions.  IF YOU GIVE WESTERN CONTROL OF YOUR BOARD, YOU ARE PUTTING YOUR INVESTMENT INCOME AT RISK    oWe believe Western, an activist hedge fund, is focused only on its own     opportunistic short-term trading gains, rather than creating long-term     value and income for Anworth and all of its stockholders.   oDo you know that Western, a short-term stockholder, acquired its entire     4.0% stake in your Company in just the past four months and, without even     attempting to engage in a constructive or substantive dialogue with your     Board, immediately notified us that it wants to replace all of your     current directors? Western states in its proxy statement that if it     obtains control of your Board, its goal is to "maximize long-term value     for all stockholders." Do you realize that Western has never presented or     discussed with your Board any plan whatsoever to enhance long-term value     and increase returns on your investment?   oWestern boasts that it has been an activist stockholder in 38 companies.     In an appendix to its proxy statement it disclosed only one occasion where     it won a board seat. Western has no apparent experience in controlling     public company boards and its director nominees have no track record     managing a mortgage REIT.   oThe only specific transactions Western identifies as part of its plan to     "maximize long-term value for all stockholders" are the liquidation and     dissolution of your Company. The liquidation of Anworth is not a     "long-term" value maximizing strategy.   oWestern admits in its proxy statement that the liquidation of Anworth     would require a new, future stockholder vote; ensue over many months;     incur various administrative expenses; and first require the payment of     all obligations owed by Anworth to its creditors and to our manager. This     would reduce the net realizable value available for payment to     stockholders and likely eliminate any meaningful gain over today's trading     price of $5.48 per share.  TO DISTORT ANWORTH'S OUTSTANDING HISTORICAL FINANCIAL PERFORMANCE, WESTERN HAS CHERRY-PICKED A SELF-SERVING TIMEFRAME AND HAS SELF-SELECTED "PEER" COMPANIES TO MAKE ITS CASE      oThe 107/12year [ ]timeframe Western uses in its proxy statement to     criticize Anworth's historical performance is highly misleading. Western     fails to mention that:         oSince Anworth's IPO over 16 years ago, your Board has delivered a          total return of 267% to stockholders, averaging 8.4% compounded          annually.        oOver the past five years, which included one of the most difficult          stock market environments and prolonged economic recessions in          history, a continued investment in Anworth has produced a 68.5%          cumulative return on investment (including reinvested dividends), an          11.0% compounded annual return.        oAnworth's stock price has increased approximately 30% so far in 2014.    oWestern constructed its own "peer group" to criticize Anworth's     performance relative to other Mortgage REITs. The fact is that Anworth's     267% total return since inception is dramatically better than the 66%     total return of all issuers included in the FTSE Nareit Mortgage-REIT     Index over the same period.  PROTECT YOUR INVESTMENT INCOME AND THE LONG-TERM VALUE OF YOUR ANWORTH STOCK. VOTE TO ELECT ALL SIX OF YOUR BOARD'S DIRECTOR NOMINEES VOTE THE WHITE PROXY CARD TODAY!  Your Board and management team have one overarching focus - - creating long-term value and increasing the return on your investment. We urge you to protect the value of your investment by affirmatively voting "FOR" the election of all of your Board's six director nominees.  DISREGARD ANY GOLD PROXY CARD AND PROXY MATERIAL YOU RECEIVE FROM OR ON BEHALF OF WESTERN  Your Board urges you not to sign or return any gold proxy card you may already have received or that you will receive from or on behalf of Western. Instead, your Board urges you to complete, sign, date and return only the WHITE proxy card enclosed with this letter and return it in the pre-addressed envelope provided. You may also refer to the instructions on your WHITE proxy card to vote your shares via the Internet or by phone.  Your vote is extremely important, no matter how many or how few shares you own. We urge you to vote today by telephone, online, or by signing and dating the enclosed WHITE proxy card and returning it in the postage-paid envelope provided. Please do not return or otherwise vote any gold proxy card sent to you by Western.  * * * * * * * * * * * * *  We thank you for your continued support.  Sincerely,  Your Board of Directors    If you have questions or need assistance voting your WHITE proxy card, please  contact:  MACKENZIE PARTNERS, INC. 105 Madison Avenue New York, New York 10016 proxy@mackenziepartners.com Call Collect: (212) 929-5500 or Toll-Free (800) 322-2885    About Anworth Mortgage Asset Corporation Anworth is an externally-managed mortgage real estate investment trust. Our principal business is to invest primarily in securities guaranteed by the U.S. Government, such as Ginnie Mae, or guaranteed by federally sponsored enterprises, such as Fannie Mae or Freddie Mac. We seek to generate income for distribution to our shareholders primarily based on the difference between the yield on our mortgage assets and the cost of our borrowings. We are managed by Anworth Management, LLC, or the Manager, pursuant a management agreement. The Manager is subject to the supervision and direction of our Board of Directors and is responsible for (i) the selection, purchase and sale of our investment portfolio; (ii) our financing and hedging activities; and (iii) providing us with management services and other services and activities relating to our assets and operations as may be appropriate. Our common stock is traded on the New York Stock Exchange under the symbol "ANH." Anworth is a component of the Russell 2000® Index.  Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 This news release may contain forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based upon our current expectations and speak only as of the date hereof.  Forward-looking statements, which are based on various assumptions (some of which are beyond our control) may be identified by reference to a future period or periods or by the use of forward-looking terminology, such as "may," "will," "believe," "expect," "anticipate," "assume," "estimate," "intend," "continue," or other similar terms or variations on those terms or the negative of those terms. Our actual results may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, including but not limited to, changes in interest rates; changes in the market value of our mortgage-backed securities; changes in the yield curve; the availability of mortgage-backed securities for purchase; increases in the prepayment rates on the mortgage loans securing our mortgage-backed securities; our ability to use borrowings to finance our assets and, if available, the terms of any financing; risks associated with investing in mortgage-related assets; changes in business conditions and the general economy, including the consequences of actions by the U.S. government and other foreign governments to address the global financial crisis; implementation of or changes in government regulations affecting our business; our ability to maintain our qualification as a real estate investment trust for federal income tax purposes; our ability to maintain an exemption from the Investment Company Act of 1940, as amended; risks associated with our home rental business; and the Manager's ability to manage our growth. Our Annual Report on Form 10-K and other SEC filings discuss the most significant risk factors that may affect our business, results of operations and financial condition. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.  (1) S&P 500, Dow Jones Industrial Average and NASDAQ Composite Index  Contact: John T. Hillman @ 310/255-4438 or 310/255-4493  SOURCE Anworth Mortgage Asset Corporation  
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