IRVINE, CA—With the closing of last week’s separation and merger between TRI Pointe Homes, Inc. and Weyerhauser, TRI Pointe is now one of the 10 largest public homebuilders in the United States by equity market capitalization.
Late last week the two companies announced that the Reverse Morris Trust had closed. The transaction, one of the biggest in homebuilding industry history, has resulted in the merger of TRI Pointe with Weyerhaeuser’s homebuilding subsidiary, Weyerhaeuser Real Estate Company (“WRECO”). The deal is valued at approximately $2.8 billion and positions TRI Pointe as one of the top 10 largest public homebuilders in the US, based on the closing price of TRI Pointe common stock on July 3.
As a result of the merger with WRECO, TRI Pointe’s land inventory has increased to approximately
31,000 owned or controlled lots with more than 19,000 of those lots located in entitlement-constrained California, where TRI Pointe’s management team has substantial experience and an established history of success.
The additional land holdings provide the necessary land supply and diversification for future land and lot sales as well as increased home deliveries. The transaction enhances TRI Pointe’s geographic presence by adding WRECO’s established collection of quality homebuilding companies, which will continue to operate under their respective brand names:
• TRI Pointe Homes – Northern and Southern California and Colorado
• Pardee Homes – Southern California and Southern Nevada
• Quadrant Homes – Puget Sound region of Washington State
• Maracay Homes – Phoenix and Tucson, Arizona
• Trendmaker Homes – Houston, Texas
• Winchester Homes – Washington, DC metro area and Richmond, Virginia
These companies boast some of the most experienced leadership teams in the home building industry averaging over 20 years of experience. The combined company will continue to be governed by TRI Pointe’s seasoned and respected executive management team. Barry Sternlicht will remain as chairman of the TRI Pointe Board of Directors, which has been expanded from seven to nine directors.
Doug Bauer will continue to serve as CEO of TRI Pointe, Tom Mitchell as president and chief operating officer, and Mike Grubbs as CFO.
“Doug, Tom and Mike are a best-in-class executive team with deep managerial talent and a proven track record running a large, geographically diverse, growth-oriented public homebuilding company,” said Sternlicht, who also serves as chairman and chief executive officer of Starwood Capital Group, which financed TRI Pointe in 2010. “I am confident that they will build upon their past success and lead TRI Pointe to greater achievements as we look to take advantage of the enormous growth opportunities in the marketplace.”
TRI Pointe’s leadership remains focused on executing a disciplined homebuilding strategy. The merger with WRECO is expected to provide TRI Pointe with significantly enhanced scale, with more than 3,400 new home deliveries and $1.6 billion in revenue on a historical combined basis over the past twelve months ended March 31.
“With the success of this completed merger, TRI Pointe is well-positioned as a leading homebuilder focused on some of the nation’s most attractive housing markets,” stated Bauer. “As we have demonstrated since we went public only 18 months ago, we continue to successfully deliver and execute on the strategy of securing new opportunities for growth while executing our plan to deliver earnings over time. These factors, combined with enhanced liquidity, the right land supply and geographic diversification, should provide a runway for sustainable growth.”