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Market Overview

Standard Pacific Corp. and The Ryland Group, Inc. Merge to Create CalAtlantic Group, Inc., America's Fourth Largest Homebuilding Company


Standard Pacific Corp. (NYSE: SPF) and The Ryland Group, Inc. (NYSE: RYL), two of the nation's premier homebuilders, today announced the closing of their merger of equals transaction and the launch of their combined consumer brand, CalAtlantic Homes. The previously announced merger of equals creates a single company, CalAtlantic Group, Inc. (NYSE: CAA), that as of June 30, 2015, had an equity market capitalization of approximately $5.4 billion, an enterprise value of approximately $8.4 billion, and owned or controlled approximately 76,000 homesites. In the 12 months ended June 30, 2015, the pro forma combined company delivered more than 12,786 homes in the aggregate with combined pro forma revenues of $5.2 billion.

CalAtlantic Group, Inc. Executive Chairman Scott D. Stowell said, "Combining two industry leaders with nearly 100 years of homebuilding experience puts us in a strong position to benefit from the continued housing market recovery. With this merger we gain both geographic and product diversification, expanding our reach and enhancing our growth prospects in the entry level, move-up and luxury market segments."

CalAtlantic Group, Inc. President and Chief Executive Officer Larry T. Nicholson said, "Today our industry reaches a significant milestone as two of its best operators combine forces in the belief that our combined future is brighter. With similar cultures and long histories of designing and building quality homes and providing exceptional customer service, Standard Pacific and Ryland are each proud of where we've been and are confident in our future together as CalAtlantic Homes."

Efficiencies and Cost Savings

The Company anticipates that production, purchasing and other synergies from the transaction could result in annual cost savings of between $50-$70 million. CalAtlantic expects to realize a significant portion of the estimated cost savings by late 2016.

Management, Board and Corporate Presence

Mr. Stowell will serve as Executive Chairman of the newly formed Board of Directors and Mr. Nicholson will serve as President and Chief Executive Officer. Current Ryland Chief Operating Officer, Peter G. Skelly, and current Standard Pacific Chief Financial Officer, Jeff J. McCall, Chief Marketing Officer, Wendy L. Marlett, and General Counsel, John P. Babel, will serve in these roles for the combined CalAtlantic Group, Inc.

The board of directors of the CalAtlantic Group, Inc. consists of 10 persons, five Standard Pacific directors (Scott D. Stowell, Bruce A. Choate, Douglas C. Jacobs, David J. Matlin and Peter Schoels) and five Ryland directors (William L. Jews (Lead Independent Director), Larry T. Nicholson, Charlotte St. Martin, Robert E. Mellor and Norman J. Metcalfe).

Given the Company's geographic breadth, having a bi-coastal corporate presence will allow CalAtlantic to most effectively manage its national homebuilding operations. The Company is planning to establish a presence in Northern Virginia while also maintaining its presence in Orange County, California.


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