Lennar Corporation (NYSE: LEN and LEN.B) announced late Monday that it has agreed to sell its Rialto Investment and Asset Management business to investment funds managed by Stone Point Capital for $340 million. Shares of LEN were up modestly in after market trading on the news.
The transaction is scheduled to close on November 30, 2018 or as soon after that as the conditions to the transaction are fulfilled. The transaction is subject to consent by the funds managed by Rialto or the investors in those funds and customary closing conditions.
Lennar will retain its Rialto Mortgage Finance business, which it expects will move into its Financial Services business at the beginning of fiscal 2019. Lennar will also retain its fund investments ($294 million as of August 31, 2018) along with its carried interests in various Rialto funds, as well as investments in other legacy Rialto balance sheet assets. The Rialto Investment and Asset Management Business will continue to be led by its current management.
Deutsche Bank Securities Inc. and Wells Fargo Securities, LLC served as financial advisors for Lennar and Goodwin Procter LLP acted as Lennar's legal counsel. Kramer Levin Naftalis and Frankel LLP acted as Stone Point's legal counsel.
