The Real Deal Miami

Lennar to acquire WCI Communities for $643M

Merger will give Lennar WCI's 14,200 home sites in Florida

September 22, 2016 11:15AM

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Stuart Miller and Keith Bass

Lennar CEO Stuart Miller and WCI CEO Keith Bass

The nation’s second largest homebuilder is acquiring WCI Communities in a merger valued at $643 million.

Miami-based Lennar Corp. will acquire Bonita Springs-based WCI into a newly formed Lennar subsidiary, the company announced on Thursday. Lennar will pay $23.50 per WCI share, which marks a 37 percent premium over WCI’s closing stock price on Wednesday.

The agreement includes a 35-day ‘go-shop’ provision that will allow WCI to seek out potentially superior proposals to maximize value for WCI stockholders, WCI said in a separate announcement.

For the last fiscal year ending on June 30, WCI completed 1,118 homes with an average price of $444,000, and has a portfolio of 14,200 home sites located in Florida’s top coastal markets, the company said.

Home prices have continued to rise following the 2007 housing crisis nationwide and in Florida.

Lennar CEO Stuart Miller said in a statement that WCI’s land portfolio will allow the home builder to “capture more of the move-up market.”

Lennar was ranked the second biggest homebuilder in the country according to the 2016 Builder 100 list. D.R. Horton came in at No. 1. WCI was No. 49, according to the list.

WCI’s stockholders have to approve the vote likely in December or January. Both of the company’s boards already approved the deal. – Katherine Kallergis