BB: After the merger, what are the top five things on your post-merger to-do list, or the top few?
JL: There are so many things. Obviously the success of the merger means we are going to have to go through an integration process, where we bring the companies together. The combination of the accounting systems, the combination of the IT systems, those are all critically important. Obviously in the merger we are trying to end up wit the very best people, the best team we can have and so keeping those people and motivating them is critically important. That is THE most important thing, the people side of this. I think we can succeed by multiple communications at a lot of different levels.
BB: You want to make sure you keep the best and keep them nurtured?
BB: No small task, really.
JL: And we have got to keep running these respective businesses until this integration process is complete, which will take, in some cases, approximately 12 months. So it's the people, run the business, do the things we have to do on the financial integration, the information technology integration and then we are going to grow.
BB: You will be poised for that growth?
BB: Where are the markets you were looking at? Since we talked last I took a look and I thought, 'Wow, you are going to be a huge power house in Phoenix.
JL: Well, we have got a significant business in Phoenix as Taylor Woodrow and when we combine the Morrison Homes business with it we become a fairly significant scale builder. More like 1,700 homes (a year.)
BB: 1,700 in one city is considerable.
BB: We talked about San Antonio and that seems to be pretty eminent. And you mentioned a few other markets too. What do you think will be the biggest challenge of that integration?
JL: They are all important.
BB: There is no prioritizing on those. They are all A priorities?
BB: The biggest problem here is how are you going to find time out to fly-fish?
JL: I may not. I might have to put that on hold for a while.
BB: It's amazing how much your life has changed in this year. In February you came to a company that was one company and now it's becoming a different company and you've got a big piece of it. That's an amazing thing.
JL: Yeah it is. It was a great opportunity for me to come to Taylor Woodrow and be the CEO and then to continue on as the CEO of the merged companies is something and it's a challenge for me, as it is for all of us, to make the merger a success but it accomplishes something that we had hoped to accomplish as Taylor Woodrow, which is to grow. We had said we wanted to grow for the next five years and, as a combined company, we continue to want to grow.
BB: So it's the same mission?
JL: The same mission.
BB: Just on a little bigger scale and with some things that will take some time to get meshed together. So it adds another layer to the challenge.
BB: Challenges are good in life.
JL: They are.
BB: When did you become a fly-fisherman? You didn't grow up fly-fishing in Beaumont, Texas.
JL: No. It was about 15 years ago and I went to Colorado and did some fishing in the mountains and I lived in Denver for about four years and I did some fishing there and I fished along the Texas coast, primarily for red fish and speckled trout.
BB: And what was it that hooked you on the sport, no pun intended?
JL: Fly-fishing is a real challenge. It's an artful challenge and you go to places that are really pretty and sometimes wild. I think fishing is interaction with nature. It's really interesting. I learn something each time I go fly-fishing. I learn something about how the fish behave, about a different part of the country, and I tend to improve my skills each time.
BB: Well, it's not a matter of just plunking down your bamboo pole with a bob on it and waiting for something to happen. It's very active.
JL: It can be.
BB: So basically it's an excuse to be out in nature and to be in wild places and quiet places, Kind of a back to the roots sort of thing?
JL: That's it. It's a way to go to really pretty interesting places and see nature at its best.
BB: You mentioned before hunting. Do you hunt?
JL: I have bird hunted, deer hunted.
BB: But fly-fishing beats that.
JL: I think fly-fishing and bird hunting with good dogs can't be beat.
BB: They are mental sports in a way.
JL: It's an escape. You have to concentrate on what you're doing. It's an escape from the day-to-day pressures and that's been fun. I've also been fly fishing several times with my son, who is very skilled and he's fun to be with.
BB: How old is he?
BB: What's he do?
JL: He's in commercial real estate in Los Angeles.
BB: We were talking a little bit about fly tying.
JL: I don't do that?
BB: Do you go out with guides who do that for you?
JL: A lot of fly-fishing guides tie their own flies A lot of salt water guides tie their own flies. A lot of the guides I go out with either tie their own flies or bring fly patterns that are consistent with the hatches on the trout streams in the season. Or in salt water, they generally bring flies that are consistent with what the fish have been eating.
BB: That's another whole level of this particular sport
JL: There's a lot of science to it. Particularly when you go to a trout stream you put in a little seine and look at what kind of food is coming down the river and it gives you an idea of what kind of nymphs you would use. And then you observe the hatches to observe what kind of fly patterns you want to throw out. So there's a science to it. These fish are smart.
BB: They know the difference between real food and fake food.
JL: They do.
BB: Do you usually come home with fish?
BB: Do you catch and release.
JL: I catch and release.
BB: You come home without even a fish dinner? Just pictures?
JL: You buy the salmon at Whole Foods.
BB: It saves having to clean fish and haul it home.
JL: That's really another benefit to this. You don't have to clean fish.
BB: And you leave them out to spawn again so you will have something to catch the next time you go.
BB: Where is the place you are dreaming of going next? Didn't you say you were trying to set up something with your buddies?
JL: We may go down to the Keys or to the Everglades to fish the flats for either redfish or bone fish, smaller tarpon and then back in the mangroves to try to catch some snook. I think that is the plan for sometime in August, September.
BB: Hopefully you can sneak away for a three-day weekend.
JL: That's what I'm going to try to do.
BB: You might need it by then with all the change management.
JL: I would expect you're right.
BB: How long is the Morrison name going to continue?
JL: We think that we are going to use the two brands and over the course of time we think there is a fit for both brands in certain markets we are in. There are some markets where there is the Morrison brand, in the Central Valley of Northern California and in Sacramento where they stand alone; there is no Taylor Woodrow brand. We don't see any immediate reason to introduce Taylor Woodrow too. By the same token, Morrison isn't in Southern California. We probably won't introduce it there any time soon. We've had good success with Taylor Woodrow. In Phoenix, Austin and Tampa, both brands are present, both brands have had some success so we have got to spend some time determining how we market and where they fall into the segmentation.
BB: So it's going to be a market-by-market decision? You don't want to lose any brand recognition that is existing?
JL: There is solid equity in both brands and we think there's great value to both brands and consumer acceptance so we aren't going to rush to any conclusions about how we use either from a consumer standpoint.
BB: Are you going to be integrating house plans?
BB: So a market-by-market decision. That's what's so tricky. You have a national, and then in this case an international, building company, but you have to still come down to the fact that it is still a local business.
JL: It is a local business, clearly a local business.
BB: The integration of your business as far as supply side management will be very interesting because that is something that has been very difficult for a lot of national builders.
JL: There are clearly some low-hanging fruit we can harvest with national contracts and we can do that rather quickly. But the commodity-type materials we may not find as much savings. Those are more market sensitive than they are national rebate and national contract. Our thinking is we are going to have some very very material savings, synergies that we will harvest from this merger.
BB: Being in the same markets is going to help.
Learn more about markets featured in this article: Los Angeles, CA.