IRVINE, Calif., Oct. 1, 2015 /PRNewswire/ -- Standard
Pacific Corp. (NYSE: SPF) and The Ryland Group, Inc. (NYSE: RYL),
two of the nation's premier homebuilders, today announced the
closing of their merger of equals transaction and the launch of
their combined consumer brand, CalAtlantic Homes. The
previously announced merger of equals creates a single company,
CalAtlantic Group, Inc. (NYSE: CAA), that as of June 30, 2015, had an equity market
capitalization of approximately $5.4
billion, an enterprise value of approximately $8.4 billion, and owned or controlled
approximately 76,000 homesites. In the 12 months ended
June 30, 2015, the pro forma combined
company delivered more than 12,786 homes in the aggregate with
combined pro forma revenues of $5.2
billion.
CalAtlantic Group, Inc. Executive Chairman Scott D. Stowell said, "Combining two industry
leaders with nearly 100 years of homebuilding experience puts us in
a strong position to benefit from the continued housing market
recovery. With this merger we gain both geographic and
product diversification, expanding our reach and enhancing our
growth prospects in the entry level, move-up and luxury market
segments."
CalAtlantic Group, Inc. President and Chief Executive Officer
Larry T. Nicholson said, "Today our
industry reaches a significant milestone as two of its best
operators combine forces in the belief that our combined future is
brighter. With similar cultures and long histories of
designing and building quality homes and providing exceptional
customer service, Standard Pacific and Ryland are each proud of
where we've been and are confident in our future together as
CalAtlantic Homes."
Efficiencies and Cost Savings
The Company anticipates that production, purchasing and other
synergies from the transaction could result in annual cost savings
of between $50-$70 million.
CalAtlantic expects to realize a significant portion of the
estimated cost savings by late 2016.
Management, Board and Corporate Presence
Mr. Stowell will serve as Executive Chairman of the newly formed
Board of Directors and Mr. Nicholson will serve as President and
Chief Executive Officer. Current Ryland Chief Operating
Officer, Peter G. Skelly, and
current Standard Pacific Chief Financial Officer, Jeff J. McCall, Chief Marketing Officer,
Wendy L. Marlett, and General
Counsel, John P. Babel, will serve
in these roles for the combined CalAtlantic Group, Inc.
The board of directors of the CalAtlantic Group, Inc. consists
of 10 persons, five Standard Pacific directors (Scott D. Stowell, Bruce
A. Choate, Douglas C. Jacobs,
David J. Matlin and Peter Schoels) and five Ryland directors
(William L. Jews (Lead Independent
Director), Larry T. Nicholson,
Charlotte St. Martin, Robert E. Mellor and Norman J. Metcalfe).
Given the Company's geographic breadth, having a bi-coastal
corporate presence will allow CalAtlantic to most effectively
manage its national homebuilding operations. The Company is
planning to establish a presence in Northern Virginia while also maintaining its
presence in Orange County,
California.
About CalAtlantic Group, Inc.
CalAtlantic Group, Inc. (NYSE: CAA), a combination of Standard
Pacific Corp. and Ryland Group, Inc., two of the nation's largest
and most respected homebuilders, offers well-crafted homes in
thoughtfully designed communities that meet the desires of
customers across the homebuilding spectrum, from entry level to
luxury, in 41 Metropolitan Statistical Areas spanning 17
states. With a trusted reputation for quality craftsmanship,
an outstanding customer experience and exceptional architectural
design earned over its 50 year history, CalAtlantic Group, Inc.
utilizes its over five decades of land acquisition, development and
homebuilding expertise to acquire and build desirable communities
in locations that meet the high expectations of the company's
homebuyers. We invite you to learn more about us by visiting
www.calatlantichomes.com.
Forward Looking Statements
This news release contains forward-looking statements.
These statements include but are not limited to statements
regarding the benefits of the merger; new home orders; deliveries;
backlog; absorption rates; cancellation rates; average home price;
revenue; profitability; cash flow; liquidity; gross margin;
operating margin; product mix; land supply; the benefit of, and
execution on, the Company's strategies; the Company's future cash
needs and the availability of additional bank commitments; and the
Company's future growth and performance. Forward-looking
statements are based on our current expectations or beliefs
regarding future events or circumstances, and you should not place
undue reliance on these statements. Such statements involve
known and unknown risks, uncertainties, assumptions and other
factors many of which are out of the Company's control and
difficult to forecast that may cause actual results to differ
materially from those that may be described or implied. Such
factors include but are not limited to: the integration of
Standard Pacific and Ryland may involve unexpected costs,
liabilities or delays; the Company's business may suffer if
Standard Pacific and Ryland are not integrated effectively and
within an appropriate timeframe; the Company may be adversely
affected by other economic, business and/or competitive factors;
the ability of the Company to recognize benefits of the merger;
risks that the transaction disrupts current plans and operations;
the potential difficulties faced by the Company in employee
retention as a result of the transaction; local and general
economic and market conditions, including consumer confidence,
employment rates, interest rates, the cost and availability of
mortgage financing, and stock market, home and land valuations; the
impact on economic conditions, terrorist attacks or the outbreak or
escalation of armed conflict involving the United States; the cost and availability
of suitable undeveloped land, building materials and labor; the
cost and availability of construction financing and corporate debt
and equity capital; the Company's significant amount of debt and
the impact of restrictive covenants in its debt agreements; the
Company's ability to repay debt as it comes due; changes in the
Company's credit rating or outlook; the demand for and
affordability of single-family homes; the supply of housing for
sale; cancellations of purchase contracts by homebuyers; the
cyclical and competitive nature of the business; governmental
regulation, including the impact of "slow growth" or similar
initiatives; delays in the land entitlement process, development,
construction, or the opening of new home communities; adverse
weather conditions and natural disasters; environmental matters;
risks relating to mortgage banking operations; future business
decisions and the Company's ability to successfully implement its
operational and other strategies; litigation and warranty claims;
and other risks discussed in Standard Pacific's and Ryland's
filings with the Securities and Exchange Commission, including the
joint proxy statement/prospectus of Standard Pacific and Ryland
filed on August 27, 2015, and the
Annual Report on Form 10-K for the year ended Dec. 31, 2014 and subsequent Quarterly Reports on
Form 10-Q for each of Standard Pacific and Ryland. The
Company assumes no, and hereby disclaims any, obligation to update
any of the foregoing or any other forward-looking statements.
The Company nonetheless reserves the right to make such updates
from time to time by press release, periodic report or other method
of public disclosure without the need for specific reference to
this press release. No such update shall be deemed to
indicate that other statements not addressed by such update remain
correct or create an obligation to provide any other
updates.
Contact: Jeff McCall, EVP
& CFO (949) 789-1655, jeff.mccall@calatl.com
Media Contact:
Danielle Tocco
CalAtlantic Group, Inc.
National Director of Communications
danielle.tocco@calatl.com
Direct Line: 949.789.1633
Cell: 714.296.0451
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SOURCE CalAtlantic Group, Inc.