Dive Brief:
- The Ryland Group/Standard Pacific Homes merger is complete, and the new corporation, CalAtlantic Group, is now the fourth-largest homebuilder in the U.S., with a market capitalization of $5.4 billion.
- The new company trades on the New York Stock Exchange using the ticker symbol CAA. Its stock opened Thursday at $40.46 a share and closed at $41.16.
- The merger, according CalAtlantic president and CEO Larry Nicholson, was timed to take advantage of the "early innings" of the housing market recovery and will position the company, which operates in 17 states, to take advantage of land purchases only available to a top-five builder.
Dive Insight:
Nicholson told GlobeSt.com that the complete integration of the two companies will take six to nine months and that they have already selected all of the new company’s divisional and regional leadership.
"As we flip the switch to CalAtlantic," Nicholson said, "we feel we can operate the business without interruption."
Slightly dampening the excitement of the merger, Nicholson said that approximately 10% of existing staff will be laid off to reduce duplication as the two homebuilders join operations.
Existing brand names, he added, will be phased out over time and will remain on homes that are currently being sold, but new developments will start selling under the CalAtlantic name.
"For the short term, we’ll be focusing on the integration and building the brand," Nicholson said. "I think we’re coming out of the gate ready for business."
When the two California-based public homebuilding giants announced their mega-merger in June, industry experts speculated that the consolidation would be the first of many involving large builders.
Sure enough, by late July, Taylor Morrison, the seventh-largest U.S. homebuilder by volume of sales, acquired the Chicago, Charlotte, NC, and Raleigh, NC, portfolios of 64th-ranked Orleans Homebuilders in a $166 million deal.
