Standard Pacific Corp. (NYSE:SPF) after market close on Friday issued a terse and unusual statement confirming that it is in talks with TOUSA, Inc., which has been operating under Chapter 11 bankruptcy protection since early 2008, "regarding a possible transaction."
Standard Pacific said in the statement that while it is its policy not to comment on rumors or speculation, it "is engaged in preliminary discussions and the exchange of information with TOUSA, Inc. regarding a possible transaction. There can be no assurances that any transaction will occur, or as to the timing, structure or terms of any transaction."
Standard Pacific shares were hammered during the trading day Friday, losing 31% of their value and closing at $1.36 per share on extremely heavy volume.Shares began to recover in after-hours trading once the statement had been issued. The stock was up 10% from its closing price to $1.50 shortly after 4:30 p.m.
The company also said, "We believe that there may be attractive land and corporate opportunities worth considering. We continuously review acquisition and other strategic opportunities which could enhance value for our stockholders. "
It ended the statement with "The Company does not anticipate having any further comment unless and until a definitive agreement for a transaction is reached."
TOUSA, based in Hollywood, Fla., filed for bankruptcy Jan. 29, listing assets of $2.3 billion and debt of $1.8 billion. The company buckled under the crushing combination of the sagging housing market and the debt burden taken on in the acquisition of Transeastern Properties in summer, 2005.