Pulte, Del Webb Lock Down $1.8-Bil Merger

PHOENIX-In a $1.8- billion deal that will create the largest homebuilder in the nation, Bloomfield Hills, MI-based Pulte Homes is buying Phoenix-based Del Webb Corp.

The takeover news had come this morning in New York to analysts and investors. The two home-building giants will merge in a tax-free stock swap valued at nearly $1.8 billion. Del Webb will become a Pulte subsidiary, which, with the purchase, will have annual revenues of more than $6 billion.

The transaction value is being based on a 15-day average of Pulte Homes’ closing stock price for a period ending three days prior to Del Webb’s stockholder meeting in late June. If the average price would be equal to Pulte Homes’ closing April 30 stock price of $46.78, the transaction would have an equity value of approximately $800 million, or $40.51 per Del Webb share, subject to adjustment pursuant to the merger agreement.