The U.S. housing industry may soon see a new homebuilder company when the proposed merger between Ryland Group and Standard Pacific Homes pushes through. Once combined, the merged company will be the 4th biggest home builder company in the country.
Shareholders of the two companies are expected to vote on the proposed merger by September 28, reports The Orange County Register (OCRegister). The shareholders will reportedly gather at the companies' respective headquarters, which is in Irvine for Standard Pacific and Westlake Village for Ryland Group. Should the proposed merger be approved, the combined companies will operate under a new name, CalAtlantic Group. The merged company will reportedly be the fourth biggest U.S. homebuilder after DR Horton, Lennar and Pulte Group.
Lawrence Dean, senior Texas adviser for the homebuilding consulting firm Metrostudy and a former Ryland employee, told the OCRegister that the combined companies will be in an "even bigger league" given the merger. Dean said, "It's definitely combining two of the biggest and most creative entities. They're definitely in a position to take on all comers and take on the world in the homebuilding industry, just due to their heft and scale."
According to the Los Angeles Times, the new company will have a 10 member board of directors. The transaction, reportedly termed as "merger of equals," will each have five Standard Pacific and five Ryland Group directors as a member of the CalAtlantic Group board. Standard Pacific company president and CEO, Scott Stowell, will serve as the new company's executive chairman, while Ryland's Larry Nicholson will be CalAltantic's president and CEO.
Meanwhile, both Ryland and Standard Pacific executives are also looking forward to the proposed merger. Stowell previously told the LA Times that the transaction will put both companies "in a strong position to benefit from the continued housing market recovery." On the other hand, Ryland's Nicholson said that the two builders are proud of their past accomplishments and are confident that their future "will be better together."
