Case Study
December 20, 2017

Building Bigger Together

Lennar and CalAtlantic Merge in $9.3 Billion Transaction, Creating the Largest Homebuilder in the U.S.


The planned merger between Lennar Corporation and CalAtlantic Group, Inc. will create the largest homebuilder in the United States with revenues in excess of $17 billion and control of 240,000 homesites in 41 markets across 21 states.


Goodwin client Lennar Corporation, founded in 1954, is one of the nation's largest builders of quality homes for all generations. Lennar builds affordable, move-up and retirement homes primarily under the Lennar brand name. CalAtlantic Group, Inc., one of the nation's largest and most respected homebuilders, offers well-crafted homes in thoughtfully designed communities that meet the desires of customers across the homebuilding spectrum, from entry level to luxury, in 43 Metropolitan Statistical Areas spanning 19 states. The companies sought a merger that would provide cost savings, growth opportunities and the ability to produce shareholder value.


The Goodwin team led by counsel David Bernstein, included members of the firm’s Real Estate Industry group as well as M+A specialists. The structuring of the transaction was complicated, because it involved an all stock merger, but CalAtlantic stockholders are given an option to elect to receive cash up to approximately 20% of the total merger consideration. It also involved voting agreements by large stockholders of both companies. The companies anticipated the deal, which they projected would close in the first quarter of 2018, would generate major cost savings and synergies. The homebuilders expected to achieve the synergies through direct cost savings, reduced overhead costs and the elimination of duplicate public company expenses.


This blockbuster deal follows Goodwin’s representation of Lennar in its $643 million acquisition of homebuilder WCI Communities last year. Scheduled to close in the first quarter of 2018, the merger is subject to approval by both Lennar’s and CalAtlantic’s stockholders, as well as customary closing conditions. “The combined company will have a strong balance sheet and generate significant cash flow available to pay down debt and repurchase shares, which will improve returns on capital and equity,” Lennar CEO Stuart Miller said.