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Lennar completes CalAtlantic merger

Merger creates nation’s largest homebuilder

Lennar has completed its previously announced merger with CalAtlantic, creating the nation’s largest homebuilder.

The merger, which makes CalAtlantic into a wholly-owned subsidiary of Lennar, was overwhelmingly approved today by both companies' stockholders, Lennar said in a statement.  The merger was approved by 99.4% of the Lennar votes that were cast and 99.9% of the CalAtlantic shares cast.

“We are extremely pleased to announce the completion of this strategic combination with CalAtlantic, creating the nation's leading homebuilder,” Lennar Chief Executive Officer Stuart Miller said. “This combination benefits from overall economic strength, driven by low unemployment, rising wages, favorable tax reform, higher consumer confidence and strong housing demand. In this context, the normalization of interest rates should be offset by these favorable economic conditions.”

The merger means Lennar will be the largest homebuilder in the United States based on revenues, the company said.  Lennar will own or control approximately 250,000 home sites and be actively selling homes in 1,300 residential communities in 21 states.

“This combination brought together two leading homebuilders in familiar markets with compatible product lines. With stable to improving market conditions, this combination enables our company to use local market concentration to drive synergies and efficiencies in the most strategic markets in the country,” Miller continued.

Several CalAtlantic associates will be joining Lennar as a result of the merger. Scott Stowell, CalAtlantic's executive chairman of the board, will join Lennar’s board. Jeff McCall, CalAtlantic's chief financial officer, will join Lennar as its new senior vice president focusing on corporate services.

As a result of the merger, CalAtlantic stockholders will receive with regard to each share of CalAtlantic common stock, 0.885 shares of Lennar Class A common stock and 0.0177 shares of Lennar Class B common stock, the company said.

According to a release, the merger consideration will consist of approximately $1.16 billion in cash, 82.7 million shares of Lennar Class A common stock and 1.6 million shares of Lennar Class B common stock. Based on New York Stock Exchange closing prices on Friday, February 9, 2018, the value of the Lennar Class A and Class B common stock that will be issued in the merger totaled $4.9 billion.


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