Forestar Group Inc.(NYSE: FOR)announced it has enterered into a definitive arrangement with D.R. Horton Inc. (NYSE: DHI) under which the national homebuilder will acquire 75% of the outstanding shares of Forestar typical stock for $17.75 per share in money.
Forestar will stay a public company, maintaining separate access to capital.
As part of the transaction, Austin-based Forestar will supply developed lots to Arlington, TX-based D.R. Horton under a “tactical relationship.”
Forestar likewise terminated its formerly announced merger arrangement with Starwood Capital Group.
“This transaction is expected to develop additional value for shareholders of both companies, and to enable Forestar to end up being a prominent national land developer,” stated Phillip J. Weber, CEO of Forestar. “Lining up Forestar’s resources with D.R. Horton’s strong demand for ended up lots, comprehensive network of markets, land acquisition and development experts and land seller and service relationships is anticipated to accelerate our development and enhance our running efficiency and returns.”
Forestar had actually previously agreed to sell itself to Starwood in April for $16 per share in money. But early last month, Forestar got an unsolicited, nonbinding proposition from D.R. Horton to get 75% of the outstanding shares of Forestar typical stock for $16.25 in cash. D.R. Horton then upped that offer to $17.75 late last month, triggering Forestar’s board to pick the homebuilder over Starwood.
Forestar, a residential and mixed-use real estate development business, owns interests in 50 property and mixed-use tasks consisted of 4,600 acres in 10 states and 14 markets.
In addition, Forestar lists a collection of various other assets that it has determined as non-core, consisting of 523,000 acres of owned mineral assets across the southern United States, 19,000 acres of timberland, 4 multifamily properties and 20,000 acres of groundwater leases in central Texas.
“The acquisition of a majority ownership position in Forestar advances D.R. Horton’s stated strategy by increasing our access to premium optioned land and lot positions and creates strategic positioning between these business,” said Donald R. Horton, chairman of his namesake business.
JMP Securities LLC is serving as financial consultant to Forestar and Skadden, Arps, Slate, Meagher & & Flom LLP is working as legal advisor.