Pulte and Centex Homebuilders to Merge
Pulte and Centex homebuilders to merge
BLOOMFIELD HILLS, Mich. and DALLAS -- April 8, 2009 -- Pulte Homes, Inc. (NYSE:PHM) and Centex Corporation (NYSE:CTX) announced that their respective boards of directors have unanimously approved a definitive merger agreement under which Pulte and Centex will combine in a stock-for-stock transaction valued at $3.1 billion, including $1.8 billion of net debt.
In calendar year 2008, Pulte and Centex delivered more than 39,000 closings with combined pro forma revenues of $11.6 billion. The combined company will have the strongest liquidity position among its peer group with more than $3.4 billion of cash as of March 31, 2009. Pulte and Centex ended March with approximately $1.7 billion of cash each.
"Combining these two industry
leaders with proud legacies into one company puts us in an excellent position to
navigate through the current housing downturn, poised to accelerate our return
to profitability," said Pulte President and Chief Executive Officer Richard J.
Dugas, Jr. "Centex's significant presence in the entry level and move-up
categories is complemented by Pulte's strength in both the move-up and active
adult segments, the latter through our popular Del Webb brand. Together we will
have considerable presence in more than 59 markets across
"The combination will also allow us to capitalize on the opportunities presented by the addition of Centex's land positions to Pulte's, including Centex's sizable holdings in both Texas and the Carolinas, two areas that continue to exhibit strength in the face of today's difficult housing market."
Centex Chairman and Chief Executive Officer Timothy Eller said, "Today represents a significant milestone in this industry's history as two leading companies join forces. We share common cultures and rich traditions of delivering quality and value, doing the right thing and exceeding the expectations of our customers. We're proud to begin writing this next chapter together.
"We are always looking for the best way to deliver more value to all our stakeholders and drive the company forward. We have had a high regard for the Pulte management team and their performance during this downturn, and I strongly believed that our organizations would complement each other's strengths. My conversations with Richard reinforced that conviction.
"We believe this is the right combination at the right time in the business cycle. By acting decisively now, we're creating unrivaled firepower to capitalize on the opportunities in homebuilding that are now becoming visible on the horizon. We will have a deeper and more expanded presence that we are confident will allow us to begin realizing the benefits of our combined scale immediately. Moreover, our shareholders will receive an immediate premium for their shares as well as participate in the upside potential of the combined company."
