flexiblefullpage - default
Currently Reading

Merger Whispers on Wall Street

Advertisement
billboard - default
Mergers + Acquisitions

Merger Whispers on Wall Street

Analysts and investors are turning up the heat on the big public home builders to maintain their double-digit growth rates, even in the face of expected spikes in interest rates and drops in housing starts.


By Bill Lurz, Senior Editor June 30, 2004
This article first appeared in the PB July 2004 issue of Pro Builder.

Analysts and investors are turning up the heat on the big public home builders to maintain their double-digit growth rates, even in the face of expected spikes in interest rates and drops in housing starts. How? Some insiders seem to think another round of mergers among the mighty makes sense.

UBS investment bankers Bob Crowley and Adam Reeder recently told Julie MacIntosh of Forbes.com that they expect a significant increase in acquisition activity over the next 12 to 18 months, as the larger home builders look to expand geographic coverage and strengthen existing market positions - building the scale they need to generate more cost savings. A handful of top builders could end up with as much as 40% to 50% of the U.S. market over the next decade, Crowley and Reeder estimate.

What's interesting is the whispers that the largest builders are talking to each other about mergers because the low-hanging fruit among large private builders is all but gone. The problem with mega-mergers among publics is that a lot of stars - and egos - have to align to allow it to happen. And volatility in share prices works against it.

But the scale that could come from another deal like Pulte/Del Webb or Lennar/U.S. Home has to be tempting enough to spur talk.

Related Stories

Business Management

Is an Employee Stock Ownership Plan Right for Your Construction Business?

Employees who are invested in the company's success may one day make the best leaders. That's where employee stock ownership plans (ESOP) come in

Business Management

David Drees: Best Practices for Managing a Private Home Building Operation  

Recognized as one of the nation’s Best Managed Companies by Deloitte Private and The Wall Street Journal, Kentucky-based Drees Homes offers a management model for other privately held home builders to follow

Business Management

Off-Site Construction Drivers and Enablers—The Great Convergence, Part 2

A closer look at what’s propelling the adoption of off-site construction methods in home building

Advertisement
boombox1 -
Advertisement
native1 - default
halfpage2 -

More in Category




Advertisement
native2 - default
Advertisement
halfpage1 -

Create an account

By creating an account, you agree to Pro Builder's terms of service and privacy policy.


Daily Feed Newsletter

Get Pro Builder in your inbox

Each day, Pro Builder's editors assemble the latest breaking industry news, hottest trends, and most relevant research, delivered to your inbox.

Save the stories you care about

Lorem ipsum dolor sit amet lorem ipsum dolor sit amet lorem ipsum dolor sit amet.

The bookmark icon allows you to save any story to your account to read it later
Tap it once to save, and tap it again to unsave

It looks like you’re using an ad-blocker!

Pro Builder is an advertisting supported site and we noticed you have ad-blocking enabled in your browser. There are two ways you can keep reading:

Disable your ad-blocker
Disable now
Subscribe to Pro Builder
Subscribe
Already a member? Sign in
Become a Member

Subscribe to Pro Builder for unlimited access

Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua.