Landsea Homes to be Acquired by Apollo's New Home Company (LSEA Acquisition)

In a bold strategic move, The New Home Company (New Home) and Landsea Homes Corporation (Nasdaq: LSEA) have entered into a definitive agreement under which New Home will acquire Landsea Homes in an all-cash transaction valued at roughly $1.2 billion. Landsea shareholders will receive $11.30 per share, reflecting a premium of approximately 61 percent to the $7.01 closing share price on May 12, 2025. The combined business will become a privately held, top-25 national homebuilder operating across ten high-growth U.S. markets.

Background on the Companies

Landsea Homes has built a reputation for creating sustainable, high-performance homes in regions such as California, Texas, Florida, and Arizona. Founded in 2005, Landsea focuses on both single-family detached and attached residences, prioritizing energy efficiency and customer experience.

The New Home Company is a portfolio company of funds managed by affiliates of Apollo Global Management (NYSE: APO), which has supported New Home since 2021. With expertise in land acquisition, design, and construction, New Home has pursued an asset-light, returns-focused model to drive consistent profitability.

Deal Terms at a Glance

Under the Merger Agreement dated May 12, 2025:

• Purchase Price: $11.30 per share in cash, net of taxes and without interest.

• Premium: Approximately 61 percent over Landsea’s May 12 closing price and 66 percent above its 90-day volume-weighted average price.

• Enterprise Value: Approximately $1.2 billion.

• Tender Offer: New Home’s wholly owned subsidiary, Lido Merger Sub, Inc., will commence a tender offer to acquire all outstanding shares.

• Expiration: The tender offer is set to expire at 12:00 midnight New York City time on June 24, 2025, unless extended.

• Second-Step Merger: Upon successful tender of a majority of shares, Merger Sub will merge into Landsea under Section 251(h) of the Delaware General Corporation Law, with Landsea surviving as a wholly owned subsidiary.

Strategic Rationale

Bringing together New Home and Landsea Homes creates a stronger, more diversified platform. Highlights include:

1. Market Diversification

   • Combined operations in nine states, Arizona, California, Colorado, Florida, Oregon, Texas, Washington, and more, will mitigate regional slowdowns.

2. Scale and Efficiency

   • The merged company is expected to deliver nearly 4,000 annual home closings, improving purchasing power and operational leverage.

3. Asset-Light Model

   • Both builders have prioritized land banking and joint ventures to limit balance sheet exposure while capturing upside through development returns.

4. Capital Support

   • Apollo Funds are committing $650 million of new equity to strengthen the balance sheet, reduce leverage, and fund growth.

Timeline and Next Steps

• Tender Offer Launch: Shortly after May 22, 2025 (when the $11.21 share price was last reported before launch).

• Tender Offer Expiration: June 24, 2025 (12:00 midnight Eastern time), unless extended.

• Second-Step Merger: Following successful tender, Merger Sub merges into Landsea, and remaining shares convert into the right to receive $11.30 in cash.

• Closing Date: Expected early in the third quarter of 2025, subject to customary conditions including majority tender, regulatory approvals, and no material adverse change.

Conditions to Closing

Key closing conditions include:

• Tender of a majority of Landsea’s outstanding common stock.

• No legal or regulatory order preventing completion.

• Absence of any material adverse effect impacting either business.

• Approval by Landsea’s Board of Directors (already secured unanimously).

No Dividend Distribution Prior to Closing

Landsea has not paid dividends in 2023, 2024, or 2025, and under the Merger Agreement is prohibited from declaring or paying dividends without New Home’s prior written consent.

Key Takeaways

This merger aligns two complementary homebuilders to create a diversified, asset-light platform poised for growth across ten high-growth markets. With strong financial backing from Apollo and a clear path to closing by early Q3 2025, shareholders gain immediate liquidity at a substantial premium, while the combined company enhances its competitive position among national builders.

FAQs

What will Landsea shareholders receive?

Each Landsea Homes shareholder will get $11.30 per share in cash, net of any withholding taxes, once the tender offer and merger close.

When is the deal expected to close?

The transaction is anticipated to close early in the third quarter of 2025, after the tender offer expires and closing conditions are met.

Will Landsea stock continue to trade?

No. Upon closing, Landsea common stock will cease trading on Nasdaq as it becomes a private subsidiary of New Home.

Who is backing the acquisition financially?

Apollo Global Management’s funds, which have been New Home’s majority shareholders since 2021, are committing $650 million of new cash equity. Millrose Properties is also providing committed land banking capital.

How does this benefit homebuyers?

The combined scale and geographic reach will allow for more product variety, consistent homebuilding standards, and potential cost efficiencies that could translate into competitive pricing.

Where can I find official documents?

Tender offer materials will be filed on Schedule TO and a recommendation on Schedule 14D-9 with the SEC. Investors can view these for free at www.sec.gov.

LSEA Acquisition

LSEA Acquisition

Financial Disclaimer

This article is for informational purposes only and does not constitute investment advice or a recommendation to purchase or sell any securities. Investors should conduct their own due diligence and consult with licensed financial advisors before making any investment decisions.