KB Home may sell stake in French unit |
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Thu, 17 May 2007 12:46
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LOS ANGELES (AP) - KB Home, one of the nation's largest homebuilders, said Thursday it is in an exclusivity period to sell its 49 percent stake in French subsidiary Kaufman & Broad SA to PAI Partners for roughly $814 million in cash.The 55 euros ($74.68) per share offer is for 10.9 million shares.The subsidiary accounted for $378.4 million, or 21.4 percent, of KB Home's total revenue in the first quarter.'The sale would further KB Home's focus on its core homebuilding operations in the U.S. where long-term prospects are excellent,' KB Home President and Chief Executive Jeffrey Mezger said in a statement.The company initially received an offer of $783.2 million, or $71.85 per share, on May 11 for the Kaufman & Broad stake, but did not name the bidder.KB Home has seen its sales and bottom line hurt by a housing downturn exacerbated in recent months by a tightening of lending standards by many lenders.Outside the U.S., housing markets remain strong, so KB Home's France segment has been a bright spot for the company.Revenue at the unit's housing operations rose 19 percent during the first quarter over the year-ago period.PAI's offer for Kaufman & Broad is binding but remains subject to customary terms and conditions, including regulatory approval.The deal may close in the third quarter.Copyright 2007 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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KB Home gets offer for French unit 