CalAtlantic (CAA) Buys Home South, Gains Additional Homesites
Zacks Investment Research | Dec 13, 2017 09:58PM ET
CalAtlantic Homes (NYSE:CAA) acquired the homebuilding operations of Georgia-based Home South Communities, one of the largest privately-held homebuilders in the Atlanta metro market.
CalAtlantic now owns and controls an additional 970 home sites across 17 communities, seven of which are actively selling. The rest of the communities are expected to start actively selling in 2018. Hence, the addition of Home South Communities will further strengthen CalAtlantic's presence in Atlanta. CalAtlantic has also offered opportunities to employees of Home South Communities.
Acquisition is an important part of CalAtlantic's growth strategy. Earlier, the company announced entry into two of the top 20 markets with a start-up in Salt Lake City and an acquisition in Seattle. The company purchased home building operations of leading Seattle land developer Oakpointe Communities. CalAtlantic now owns or controls over 1,850 lots in this land constrained market and is targeting the entry level, first move up and active adult buyers.
Importantly, CalAtlantic is about to get acquired by Lennar Corp. (NYSE:LEN) in a $9.3-billion deal. This combined business is expected to create one of the country’s largest homebuilder.
Post completion in the first quarter of 2018, Lennar and CalAtlantic will control nearly 240,000 homesites nationwide. The combined company will cover approximately 50% of the U.S. population and is expected to generate roughly $250 million in annual cost savings, with about $75 million expected in fiscal 2018. The savings include lower overhead costs and elimination of duplicative corporate expenses.
Price Performance
CalAtlantic’s shares have gained more than 56% in the last three months, surpassing 26% growth of its Original post
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.