Cavco Industries, the Phoenix-based builder of manufactured homes, announced the close of its acquisition of The Commodore Corp. in a deal totaling $153 million dollars.
The largest independent builder of manufactured and modular homes in the United States, Commodore operates under several different brand names including Commodore Homes of Pennsylvania, Commodore Homes of Indiana, Colony Homes, MidCountry Homes, Pennwest Homes and R-Anell Homes. As part of the deal, Cavco acquires Commodore’s six manufacturing facilities and two wholly-owned retail stores in Indiana and New York. For the 12-month period ending March 31, Commodore generated net sales of $258 million and sold 6,600 modules, equivalent to 3,700 homes.
“We are excited to welcome the Commodore employees to the Cavco family and look forward to building on the strong reputation and success that Commodore has developed over their long history,” said Bill Boor, Cavco president and CEO.
The deal, which was originally announced in July, expands Cavco’s presence into the Northeastern United States and further establishes the company’s foothold within Midwest and Mid-Atlantic markets. In addition to producing manufactured homes under several different brand names and modular homes through its subsidiary, Nationwide Homes, Cavco Industries builds RVs, cabin homes and commercial structures and offers financing through its wholly-owned lender, CountryPlace Mortgage.
The merger between the two manufactured-home leaders comes after the Biden administration encouraged construction of such housing earlier this month, citing it as an affordable option for families to achieve wealth through homeownership. Biden called on state and local jurisdictions to ease zoning restrictions and lower financing hurdles to allow for more construction of manufactured homes.
Cavco funded the deal for Commodore Corp. with available cash on hand. In its fiscal first quarter ending July 3, the company reported net income of $27 million thanks to the sale of 6,318 modular constructions and 3,700 factory-built homes. Orders also outpaced construction for the quarter.
Since the original acquisition announcement on July 26, Cavco’s stock price (CVCO) has risen 7.06% from $228.41 to $244.55 as of about 2 p.m. on September 28.
Reporter, National Mortgage News