D.R. Horton Inc. is planning to buy Terramor Homes' building operations for $60 million in cash, expanding the potential customer base for the larger company's in-house lending unit.
The assets acquired include an estimated 305 lots, 156 homes in inventory and a sales backlog of 63 homes. D.R. Horton also is acquiring control of an estimated 535 lots through option contracts. Terramor will operate as a separate division of D.R. Horton after the acquisition.
"We are excited for the Terramor team to join the D.R. Horton family. Their quality building operations and local market expertise make Terramor an excellent extension as we strengthen our local market position in Raleigh and the surrounding markets," Donald Horton, chairman of D.R. Horton's board, said in a press release.
Terramor, which is based in Raleigh, N.C., closed 273 homes and generated $85.7 million in revenue during the 12-month period ending Nov. 30. Its homes have an average sales price of $314,000. Terramor's average home size is an estimated 2,300 square feet.
D.R. Horton, in comparison, closed 51,857 homes during its fiscal year ended Sept. 30. It is based in Arlington, Texas, and has operations in 84 markets in 29 states. D.R. Horton's portfolio includes several brands with sales prices as low as $100,000 and as high as more than $1 million. Its builder brands include Emerald Homes, Express Homes and Freedom Homes. D.R. Horton also provides title services as well as mortgage financing.
The company's stock took a steep drop recently in response to concern its executives voiced about
