SCOTTSDALE, Ariz., Oct. 2, 2018 /PRNewswire/ -- Taylor Morrison
Home Corporation (NYSE: TMHC), a national homebuilder and
developer, today announced the closing of its acquisition of AV
Homes (NASDAQ: AVHI). The complementary land and community
portfolio AV Homes offers marks a significant new phase in Taylor
Morrison's growth strategy.
Highlights:
- Purchase multiple of approximately 1x book based on implied
value of total consideration at closing
- Enhanced scale in five overlapping markets: Orlando, Phoenix, Charlotte, Raleigh and Dallas-Ft. Worth, and the addition of
Jacksonville
- The combined company will hold a top five position in six
markets and top 10 in 14 markets
- Strong 55-plus land positions in Orlando, Phoenix and Raleigh
- Growth into the more affordable, first-time buyer segment
The combined company is expected to generate approximately
$5 billion in revenue in 2018, with a
portfolio of approximately 54,000 owned and controlled lots and 350
active selling communities at time of close. In 2017, Taylor
Morrison and AV Homes closed 8,032 homes and 2,491 homes,
respectively.
"When we set our sights on growing our business, we were looking
for a builder whose footprint overlaid neatly with ours and could
take us deeper into the top housing markets we operate in today,"
said Sheryl Palmer, Taylor Morrison
chairman and CEO. "This deal represents a leap forward at a time
when macro fundamentals favor housing and support Taylor Morrison's
smart-growth roadmap. The combined business broadens our target
market with more options for first-time and 55-plus buyers, two
consumer groups AV Homes served well."
Growth in the more affordable first-time buyer segment—including
growing the affordable active adult product offerings—forms a key
component of the company's long-term vision. The improved range of
affordable options follows the homebuilder's independent market
research that revealed significant consumer demand for balancing
home price with lifestyle and experiences.
The deal expands Taylor Morrison's local scale and market share
in five in-demand overlapping markets, boosting its status from top
10 builder to top five or higher in Phoenix, Dallas-Ft.
Worth, Charlotte,
Raleigh and Orlando. With greater access to scale
efficiencies and a continued drive for operational excellence, the
company anticipates top- and bottom-line performance improvement,
in addition to synergies from overheads, increased mortgage capture
rates and local and national purchasing opportunities.
The acquisition of AV Homes increases Taylor Morrison's
workforce by approximately 20 percent. The company's comprehensive
integration plan is aimed at delivering a seamless employee
onboarding experience while quickly capturing savings and
operational efficiencies.
"We are thrilled to welcome AV Homes team members to the Taylor
Morrison family, and are excited to work together to make the
transition into our culture, technology environment and operations
as seamless and productive as possible," added Palmer.
Throughout the integration process, the business will continue
to focus on leveraging strategic growth to enhance the customer
experience, including expanded affordability in core locations and
a more personalized technology-enhanced homebuying
journey.
Citigroup Global Markets, Inc. served as the financial advisor
to Taylor Morrison and Paul, Weiss, Rifkind, Wharton & Garrison
LLP acted as Taylor Morrison's legal counsel. JP Morgan Securities
LLC and Moelis & Company LLC served as the financial advisors
to AV Homes and Wachtell, Lipton, Rosen & Katz acted as AV
Homes' legal counsel.
About Taylor Morrison
Taylor Morrison Home Corporation (NYSE: TMHC) is a leading
national homebuilder and developer that has been recognized as the
2016, 2017 and 2018 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.
Forward-Looking Statements
This press release includes "forward-looking statements." These
statements are subject to a number of risks, uncertainties and
other factors that could cause our actual results, performance,
prospects or opportunities, as well as those of the markets we
serve or intend to serve, to differ materially from those expressed
in, or implied by, these statements. You can identify these
statements by the fact that they do not relate to matters of a
strictly factual or historical nature and generally discuss or
relate to forecasts, estimates or other expectations regarding
future events. Generally, the words "believe," "expect," "intend,"
"estimate," "anticipate," "project," "may," "can," "could,"
"might," "will" and similar expressions identify forward-looking
statements, including statements related to expected operating and
performing results, planned transactions, planned objectives of
management, future developments or conditions in the industries in
which we participate and other trends, developments and
uncertainties that may affect our business in the future.
Such risks, uncertainties and other factors include, among other
things: changes in general and local economic conditions (including
as a result of recent extreme weather conditions); the inherent
uncertainty associated with financial or other projections; the
integration of Taylor Morrison and AV Homes and the ability to
recognize the anticipated benefits from the combination of Taylor
Morrison and AV Homes; unanticipated difficulties or expenditures
relating to the transaction, the response of business partners and
retention as a result of the announcement of the transaction; the
anticipated size of the markets and continued demand for Taylor
Morrison's and AV Homes' homes and the impact of competitive
responses to the transaction; slowdowns or severe downturns in the
housing market; homebuyers' ability to obtain suitable financing;
increases in interest rates, taxes or government fees; impacts from
the recently enacted tax reform legislation; shortages in,
disruptions of and cost of labor; competition in our industry; any
increase in unemployment or underemployment; inflation or
deflation; the seasonality of our business; our ability to obtain
additional performance, payment and completion surety bonds and
letters of credit; higher cancellation rates; significant home
warranty and construction defect claims; our reliance on
subcontractors; failure to manage land acquisitions, inventory and
development and construction processes; availability of land and
lots; decreases in the market value of our land inventory; new or
changes in government regulations and legal challenges; our
compliance with environmental laws; our ability to sell mortgages
we originate and claims on loans sold to third parties;
governmental regulation applicable to our mortgage operations and
title services business; the loss of any of our important
commercial relationships; our ability to use deferred tax assets;
raw materials and building supply shortages and price fluctuations;
our concentration of significant operations in certain geographic
areas; risks associated with our unconsolidated joint venture
arrangements; information technology failures and data security
breaches; costs to engage in and the success of future growth or
expansion of our operations or acquisitions or disposals of
businesses; costs associated with our defined benefit and defined
contribution pension schemes; damages associated with any major
health and safety incident; our ownership, leasing or occupation of
land and the use of hazardous materials; material losses in excess
of insurance limits; existing or future litigation, arbitration or
other claims; negative publicity or poor relations with the
residents of our communities; failure to recruit, retain and
develop highly skilled, competent people; utility and resource
shortages or rate fluctuations; constriction of the capital
markets; risks related to our debt and the agreements governing
such debt; our ability to access the capital markets; and risks
related to our structure and organization. In addition, other such
risks and uncertainties may be found in our most recent annual
report on Form 10-K filed with the Securities and Exchange
Commission (SEC) as such factors may be updated from time to time
in our periodic filings with the SEC. We undertake no duty to
update any forward-looking statement, whether as a result of new
information, future events or changes in our expectations, except
as required by applicable law.
CONTACT: Investor Relations
Taylor Morrison Home Corporation
(480) 734-2060
investor@taylormorrison.com
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SOURCE Taylor Morrison