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Taylor Morrison Prices Increased Shares at Top of Range in IPO

April 10 (Bloomberg) -- Taylor Morrison Home Corp., a builder owned by TPG Capital and Oaktree Capital Management LP, raised $628.6 million in its initial public offering, pricing an increased number of shares at the top of the marketed range.

The Scottsdale, Arizona-based homebuilder sold 28.6 million shares for $22 each, according to a statement yesterday, after offering 23.8 million shares for $20 to $22. The shares will start trading today, listed on the New York Stock Exchange under the symbol TMHC.

Taylor Morrison is going public amid a strengthening U.S. housing recovery. Demand for new houses has come back after the worst housing crash since the Great Depression as buyers seek to take advantage of low mortgage rates while facing a diminished supply of existing properties on the market. U.S. new homes sold at an annual pace of 411,000 in February, up 12 percent from a year earlier.

The company planned to sell all of the stock in the offering, according to the original terms of the prospectus, and to use $275 million of the proceeds along with $7 million of cash on hand to buy shares back from existing investors. According to regulatory filings before the offering, Fort Worth, Texas-based TPG and Los Angeles-based Oaktree would each own 39 percent of the company post-IPO.

TPG and Oaktree led a buyout of Taylor Morrison from its U.K.-based parent Taylor Wimpey Plc in March 2011. The takeover was valued at $1.2 billion, including a $620.3 million equity investment from TPG and Oaktree along with JH Investments Inc. The remainder of the purchase was financed with debt. TPG and Oaktree subsequently invested $150 million more, filings show.

Top 10

Taylor Morrison, which builds in five U.S. states and Canada, had net income of $430.8 million and sales of $1.44 billion last year, ranking it among the 10 largest publicly traded homebuilders by revenue, according to its prospectus. It sold 4,014 homes in the U.S. and Canada with an average price of $364,000.

Orders increased about 46 percent, to 1,697 homes, in the first quarter from a year earlier, the company said in a regulatory filing April 8.

Credit Suisse Group AG and Citigroup Inc. led the offering.

To contact the reporters on this story: John Gittelsohn in Los Angeles at johngitt@bloomberg.net; Lee Spears in New York at lspears3@bloomberg.net

To contact the editor responsible for this story: Kara Wetzel at kwetzel@bloomberg.net

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