SCOTTSDALE, Ariz., Nov. 6, 2019 /PRNewswire/ --
Highlights:
- Creates the nation's fifth largest homebuilder based on LTM
home deliveries
- Top 5 position in 16 of the combined 23 markets
- Entry into Washington,
Oregon and Nevada markets
- Significantly increases entry-level product offerings
- Anticipate approximately $80
million in annualized synergies from transaction
- Acquisition price of approximately $2.4
billion yields an attractive purchase multiple of 1x
book
Taylor Morrison Home Corporation (NYSE: TMHC), a leading
national homebuilder and developer, and William Lyon Homes (NYSE:
WLH), one of the nation's largest homebuilders in the Western United States, today announced they
have entered into a definitive agreement pursuant to which Taylor
Morrison will acquire all of the outstanding shares of William Lyon
Homes common stock for per share consideration of (1) $2.50 in cash and (2) 0.800 shares of Taylor
Morrison common stock, implying a company value for William Lyon
Homes of $21.45 per share or
$2.4 billion including assumption of
debt, yielding an attractive purchase price multiple of 1x book.
The transaction consideration mix consists of approximately 90
percent Taylor Morrison stock and 10 percent cash. Based on current
trading, Taylor Morrison stockholders will own approximately 77
percent of the combined company while William Lyon Homes
stockholders will own approximately 23 percent.
The transaction has been unanimously approved by the Boards of
Directors of both Taylor Morrison and William Lyon Homes and will
be submitted to the stockholders of William Lyon Homes for
approval. The issuance of shares of Taylor Morrison common stock in
the transaction will also be submitted to the stockholders of
Taylor Morrison for approval. The transaction is expected to close
late in the first quarter or early in the second quarter of 2020
and the closing is subject to the satisfaction of customary closing
conditions. William H. Lyon,
executive chairman and chairman of the board and holder of
approximately 42 percent of the voting power of William Lyon Homes
common stock, has agreed to vote all of the shares of William Lyon
Homes common stock controlled by him in support of the
transaction.
"The agreement to acquire William Lyon Homes marks a historic
day for Taylor Morrison as we continue to grow our business in
smart and meaningful ways," said Sheryl
Palmer, Taylor Morrison chairman and CEO. "The combined
business provides the unique opportunity to gain increased local
scale and expertise within six of our major markets, while
expanding Taylor Morrison into Washington, Oregon and Nevada. We've long aspired to be in the
Pacific Northwest and have looked for the right point of entry at
the right time and at the right price—and that's exactly what this
represents. This will be our sixth builder acquisition in seven
years and a demonstration of the proven discipline and expertise in
M&A that we have developed over the years."
The strategic combination creates the nation's fifth largest
homebuilder based on the last 12 months (LTM) of closings, and
firmly places Taylor Morrison in a Top 5 position in 16 of the
combined 23 markets with an estimated 14,200 closings for the pro
forma combined company.
"William Lyon Homes' legacy spans
more than six decades of outstanding construction and customer
care, and our team of professionals has set a high standard for the
homebuilding industry," said Matthew R.
Zaist, William Lyon Homes president and CEO. "The combined
business will represent a powerhouse of a builder that can meet the
strong demand of entry-level and first-time move-up buyers—consumer
segments that represent 85 percent of William Lyon's closings last year. We are
excited to join forces with Taylor Morrison and draw upon their
proven track record and greater access to scale efficiencies to
meet consumer demand with a reputable, quality product."
"William Lyon Homes is a family business rooted in strong values
and tradition, which makes us delighted to join a company with one
of the most recognized and highly regarded cultures in
homebuilding," said William H. Lyon,
William Lyon Homes executive chairman and chairman of the board.
"The decision to partner with Taylor Morrison was based on shared
strategic alignment, likeminded core values, and a long history of
integrity. We are confident in the success Taylor Morrison
demonstrates through its reputation of leadership, quality
construction and unparalleled customer experience and know our
teams, our customers and our stockholders will be in good
hands."
Citigroup Global Markets, Inc. served as exclusive financial
advisor to Taylor Morrison and Paul, Weiss, Rifkind, Wharton &
Garrison LLP acted as Taylor Morrison's legal counsel. J.P.
Morgan Securities LLC served as exclusive financial advisor to
William Lyon Homes and Latham & Watkins, LLP acted as
William Lyon Homes' legal
counsel.
Conference Call
A public webcast to discuss this announcement will be held Wed.,
Nov. 6 at 8:30 a.m. Eastern
time. The participant dial-in is 1 (855) 470-8731 and the
passcode is 1196546. A webcast replay will also be available
at investors.taylormorrison.com later that day.
About Taylor Morrison
Taylor Morrison Home Corporation (NYSE: TMHC) is a leading
national homebuilder and developer that has been recognized as the
2016, 2017, 2018 and 2019 America's Most Trusted® Home Builder by
Lifestory Research. Based in Scottsdale,
Arizona we operate under two well-established brands, Taylor
Morrison and Darling Homes. We serve a wide array of consumer
groups from coast to coast, including first-time, move-up, luxury,
and 55 plus buyers. In Texas,
Darling Homes builds communities with a focus on individuality and
custom detail while delivering on the Taylor Morrison standard of
excellence.
For more information about Taylor Morrison and Darling Homes
please visit www.taylormorrison.com or www.darlinghomes.com.
About William Lyon Homes
William Lyon Homes is one of the largest Western U.S. regional
homebuilders. Headquartered in Newport
Beach, California, the Company is primarily engaged in the
design, construction, marketing and sale of single-family detached
and attached homes in California,
Arizona, Nevada, Colorado, Washington, Oregon and Texas. Its core markets include Orange County, Los
Angeles, San Diego,
Riverside, San Bernardino, the South and East Bay Areas
of San Francisco, Phoenix, Las
Vegas, Denver, Fort Collins, Portland, Seattle, Houston, Austin and San
Antonio. The Company has a distinguished legacy of more than
65 years of homebuilding operations, over which time it has sold in
excess of 110,000 homes. The Company markets and sells its homes
under the William Lyon Homes brand in all of its markets except for
Washington and Oregon, where the Company operates under the
Polygon Northwest brand.
Forward-Looking Statements
Some of the statements in this communication are forward-looking
statements (or forward-looking information) within the meaning of
applicable U.S. securities laws. These include statements using the
words "believe," "target," "outlook," "may," "will," "should,"
"could," "estimate," "continue," "expect," "intend," "plan,"
"predict," "potential," "project," "intend," "estimate," "aim," "on
track," "target," "opportunity," "tentative," "positioning,"
"designed," "create," "seek," "would," "upside," "increases,"
"goal," "guidance" and "anticipate," and similar statements and the
negative of such words and phrases, which do not describe the
present or provide information about the past. There is no
guarantee that the expected events or expected results will
actually occur. Such statements reflect the current views of
management of Taylor Morrison Home Corporation, a Delaware corporation ("Taylor Morrison"), or
William Lyon Homes, a Delaware
corporation ("William Lyon Homes"), and are subject to a number of
risks and uncertainties. These statements are based on many
assumptions and factors, including general economic and market
conditions, industry conditions, operational and other factors. Any
changes in these assumptions or other factors could cause actual
results to differ materially from current expectations. All
forward-looking statements attributable to William Lyon Homes or
Taylor Morrison or persons acting on their behalf, and are
expressly qualified in their entirety by the cautionary statements
set forth in this paragraph. Undue reliance should not be placed on
such statements. In addition, material risks and uncertainties that
could cause actual results to differ from forward-looking
statements include, among other things: the inherent uncertainty
associated with financial or other projections, including
anticipated synergies; the integration of Taylor Morrison and
William Lyon Homes and the ability to recognize the anticipated
benefits from the combination of Taylor Morrison and William Lyon
Homes, and the amount of time it may take to realize those
benefits, if at all; the risks associated with Taylor Morrison's
and William Lyon Homes' ability to
satisfy the conditions to closing the consummation of the merger,
including obtaining the requisite stockholder approvals, and the
timing of the closing of the merger; the failure of the merger to
close for any other reason; the outcome of any legal proceedings
that may be instituted against the parties and others related to
the merger; any unanticipated difficulties or expenditures relating
to the merger; the effect of the announcement and pendency of the
merger on the respective business relationships or operating
results of Taylor Morrison, William Lyon Homes, or the combined
company; risks relating to the value of the Taylor Morrison common
stock to be issued in connection with the merger, and the value of
the combined company's common stock after the merger is
consummated; the anticipated size of the markets and continued
demand for Taylor Morrison's and William
Lyon Homes' homes and the impact of competitive responses to
the announcement and pendency of the merger; the diversion of
attention of management of Taylor Morrison or William Lyon Homes
from ongoing business concerns during the pendency of the merger;
and the access to available financing on a timely basis, and the
terms of any such financing. Additional risks and uncertainties are
described in Taylor Morrison's and William
Lyon Homes' respective filings with the U.S. Securities and
Exchange Commission (the "SEC"), including as described under the
heading "Risk Factors" in Taylor Morrison's Annual Report on Form
10-K for the year ended December 31,
2018, filed with the SEC on February
20, 2019, in William Lyon
Homes' Annual Report on Form 10-K for the year ended
December 31, 2018 filed with the SEC
on February 28, 2019, and in their
respective subsequent Quarterly Reports on Form 10-Q.
Forward-looking statements speak only as of the date they are made.
Except as required by law, neither Taylor Morrison nor William Lyon
Homes has any intention or obligation to update or to publicly
announce the results of any revisions to any of the forward-looking
statements to reflect actual results, future events or
developments, changes in assumptions or changes in other factors
affecting the forward-looking statements.
Important Additional Information and Where to Find it
This communication is not intended to and does not constitute an
offer to sell or the solicitation of an offer to subscribe for or
buy or an invitation to purchase or subscribe for any securities or
the solicitation of any vote or approval in any jurisdiction, nor
shall there be any sale, issuance or transfer of securities in any
jurisdiction in contravention of applicable law. In connection with
the proposed merger between Taylor Morrison and William Lyon Homes,
Taylor Morrison will file with the SEC a registration statement on
Form S-4 that will include a joint proxy statement of Taylor
Morrison and William Lyon Homes that also constitutes a prospectus
of Taylor Morrison (the "Joint Proxy Statement/Prospectus"). Taylor
Morrison and William Lyon Homes
plan to mail to their respective shareholders the definitive Joint
Proxy Statement/Prospectus in connection with the merger. INVESTORS
AND SECURITY HOLDERS OF TAYLOR
MORRISON AND WILLIAM LYON HOMES
ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS AND OTHER
RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC CAREFULLY WHEN
IT BECOMES AVAILABLE BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION
ABOUT TAYLOR MORRISON, WILLIAM
LYON HOMES, THE MERGER AND RELATED MATTERS. Investors and security
holders will be able to obtain free copies of the Joint Proxy
Statement/Prospectus (when available) and other documents filed
with the SEC by Taylor Morrison and William Lyon Homes through the
website maintained by the SEC at www.sec.gov. In addition,
investors and security holders will be able to obtain free copies
of the documents filed with the SEC by Taylor Morrison in the
Investor Relations section of Taylor Morrison's website at
http://investors.taylormorrison.com or by contacting Taylor
Morrison's Investor Relations at investor@taylormorrison.com or by
calling (480) 734-2060, and will be able to obtain free copies of
the documents filed with the SEC by William Lyon Homes in the
Investor Relations section of William Lyon
Homes' website at www.lyonhomes.com or by contacting
William Lyon Homes' Investor
Relations at WLH@finprofiles.com or by calling (310) 622-8223.
Participants in the Merger Solicitation
Taylor Morrison, William Lyon
Homes and certain of their respective directors, executive officers
and employees may be considered participants in the solicitation of
proxies in connection with the proposed merger. Information
regarding the persons who may, under the rules of the SEC, be
deemed participants in the solicitation of the shareholders of
Taylor Morrison and William Lyon Homes in connection with the
merger, including a description of their respective direct or
indirect interests, by security holdings or otherwise, will be
included in the Joint Proxy Statement/Prospectus described above
when it is filed with the SEC. Additional information regarding
Taylor Morrison's directors and executive officers is also included
in Taylor Morrison's proxy statement for its 2019 Annual Meeting of
Shareholders, which was filed with the SEC on April 16, 2019, and information regarding
William Lyon Homes' directors and
executive officers is also included in William Lyon Homes' proxy statement for its 2019
Annual Meeting of Stockholders, which was filed with the SEC on
March 29, 2019. These documents are
available free of charge as described above.
CONTACT: Investor Relations
Taylor Morrison Home Corporation
(480) 734-2060
investor@taylormorrison.com
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SOURCE Taylor Morrison