Skyline and Champion Merge to Become Skyline Champion Corporation, America’s Largest Factory-Built Housing Company
In a surprising development, Skyline Corporation and Champion Enterprises, LLC, the parent company of Champion Home Builders, Inc., announced last Friday that they will combine their operations. The new company will be the nation’s largest publicly traded manufactured housing company, Skyline Champion Corporation.
Surprising in that industry conjecture for several months was that Skyline was to be gobbled up by behemoth Clayton, heretofore the largest factory-built housing company in the U.S. Instead, the new Skyline Champion Corporation will supplant Berkshire Hathaway’s Clayton Manufactured Housing as the nation’s number one builder of manufactured homes.
According to the merging companies, the new corporation will include 36 manufacturing facilities, 21 factory-direct retail locations, and provide transportation services to the manufactured home industry from 10 locations across the United States.
Champion CEO Keith Anderson Will Serve as CEO of Skyline Champion Corporation
According to Goshen News, Champion Chief Executive Officer Keith Anderson, will also serve as CEO of Skyline Champion Corp. In addition, Laurie Hough, Champion chief financial officer, will serve as CFO of the combined company. Skyline anticipates nominating John Firth, current Chairman of Skyline, and Rich Florea, current CEO of Skyline, as directors of the combined company and Art Decio, original founder of Skyline and member of the board since 1959, as a senior advisor to the combined company’s board of directors, according to the company. Skyline Champion’s principal office will remain in Elkhart, Indiana, with additional executive offices in Troy, Michigan.
Merger Expected To Drive Revenue Growth Past $1 Billion Over Next 12 Months
It is anticipated that the transaction will generate annual synergies to be achieved through direct cost savings, reduced overhead costs, and operational improvement opportunities. Additional synergies also are expected through cross-selling and distribution optimization by leveraging the company’s combined network of owned and independent manufactured and modular home dealers, as well as significantly increased size and scale, with pro forma combined revenues of greater than $1 billion over the past twelve months.
Rich Florea, Skyline’s Chief Executive Officer, had this to say about the merger:
“The combination of Skyline and Champion represents a unique opportunity for two well-respected companies with strong brand history to come together and continue providing high-quality homes for customers, while also providing the greatest long term value for shareholders. The combined company will have a strong presence throughout North America and will operate at a significant scale in addition to offering a broader choice of homes to customers. We believe Skyline Champion Corporation will be well positioned for impressive growth in the coming years to the benefit of employees, shareholders and customers.”
Keith Anderson, Chief Executive Officer of Champion, commented:
“Getting to know the Skyline team has reaffirmed our belief that the two companies are a great fit for combination. Both companies share a deep commitment to providing quality products and outstanding customer service. We will remain focused on executing our strategy as an even stronger company. I am particularly pleased that Art Decio has agreed to serve as a senior advisor to the Board. Art is a legendary figure in the manufactured housing industry and we are fortunate to have the benefit of his lifelong commitment to quality and integrity in our industry.”
Legendary Skyline Founder, Art Decio, Fully Supports Transaction
Art Decio joined Skyline in June of 1952, when its operations were headquartered in a small welding garage in Elkhart, Indiana. In June of 1959, at the age of 28, he directed an expansion program that soon made Skyline a leading national producer of manufactured housing. The company enjoyed profitability every year during his leadership as Chief Executive Officer from 1952 through 1998.
Mr. Decio offered his own unique perspective on the company he built into a national powerhouse joining forces with Champion:
“Champion and Skyline are tremendous brands in our industry, both dating back to the 1950s. Walter and Henry, Champion’s founders, built a tremendous company that will be a great partner with Skyline. Both Skyline and Champion share similar corporate cultures and have earned a reputation for uncompromising integrity across their relationships with communities, retailers, suppliers, and customers. Skyline Champion Corporation will be well-positioned to continue to grow and serve its customers with the best products the industry has to offer.”
The transaction, expected to be completed in the first half of 2018, is subject to the receipt of regulatory approvals and other customary closing conditions, as well as the approval of Skyline’s shareholders. Skyline intends to file a proxy statement with the SEC in addition to other relevant materials and documents regarding the proposed transaction.