Nation's 4th Largest Builder Created Through Merger
Originally published by: Orange Country Register — October 1, 2015
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Two US homebuilders have merged to create the county's fourth largest builder. Standard Pacific Corp. and The Ryland Group, Inc. merged into a new company, CalAtlantic Group Inc.
Papers completing the merger were to be filed at 12:01 a.m. Thursday, although knitting the two companies together into the nation’s fourth-biggest homebuilder will take another six to nine months, said Larry Nicholson, president and CEO of the combined operation.
“Tomorrow starts a new legacy,” Nicholson said Wednesday as he prepared to close the merger.
The firm will have two corporate offices rather than a single headquarters, one near Washington, D.C., in northern Virginia, the other in Irvine. Nicholson will work at the northern Virginia office, and CalAtlantic Executive Chairman Scott Stowell, Standard Pacific’s current CEO, will work in Irvine.
The firm's new website also launched Thursday at www.CalAtlanticHomes.com. The stock price opened at $40.46 a share, and was trading at $41.58 by early afternoon.
Nicholson said the merger is timed to take advantage of the houing market recovery, which still is in early innings, he said. It also will position the new company to grow and take advantage of land purchases only available to a top five builder.
Nicholson said about 10 percent of the staff will be laid off and that offices will be combined in nine metro areas where the two companies both had operations. Corporate staffing also will be trimmed to reduce duplication.
The new name won’t go up on homes now selling. The existing brands will be phased out over time, Nicholson said. But new developments will start selling under the new name.
Nicholson said leadership positions for all the divisions have been determined. Since the merger was announced in June, 15 integration teams have been working side-by-side.
“For the short term, we’ll be focusing on the integration and building the (CalAtlantic) brand,” Nicholson said. “I think we’re coming out of the gate ready for business.”