The independent public company has entered a definitive merger agreement with Pretium and Ares Management to acquire Front Yard and create the “second-largest single-family rental owner and operator in the US.”
“We are excited to have reached an agreement with Pretium and Ares Management for the sale of our company, which we believe represents an outstanding, value-maximizing outcome for Front Yard stockholders,” said George Ellison, Front Yard’s CEO. “Pretium has built an impressive portfolio of single-family rental homes and has developed an industry-leading platform that includes more than 40,000 homes under management.”
The acquisition values Front Yard at roughly $2.4 billion, including debt to be assumed or refinanced. Under the terms of the deal, Front Yard stockholders will receive $13.50 in cash per share.
“This transaction is an important development in the evolution of the single-family rental sector as the asset class continues to perform strongly and attract increasing amounts of institutional investment,” said Pretium Chairman and CEO Don Mullen. “Pretium is proud of the role we have played in driving the growth and maturation of the industry, and we look forward to building on that track record with this acquisition.”
The firms expect to close the transaction in the first quarter of 2021, subject to the approval of the holders of a majority of Front Yard’s outstanding shares and the satisfaction of customary closing conditions.