Source: Fortune
Summary
Berkshire Hathaway will acquire Taylor Morrison Home Corp. in an all-cash deal worth $6.8 billion. The offer represents a 24% premium to the home builder’s latest closing price. The deal is expected to close in the second half of this year. Berkshire Hathaway CEO Greg Abel said the acquisition will help deliver the dream of homeownership to more Americans. Taylor Morrison is one of the largest community developers and homebuilders in the US.
Our Reading
The numbers tell one story.
Berkshire Hathaway’s $6.8 billion acquisition of Taylor Morrison Home Corp. is the first multibillion-dollar deal under CEO Greg Abel. The company’s cash pile reached $397 billion at the end of the first quarter. Taylor Morrison’s existing management team will continue to lead the company. This deal comes at a time when homebuilding in the US has seen declines. Abel’s comments about unifying Berkshire’s homebuilding operations over time are a departure from the company’s trademark strategy. The acquisition will make Taylor Morrison a private company.
Greg Abel is investing in a declining market, with a strategy that may not be typical for Berkshire Hathaway.
Author: Evan Null
