Shares of Toll Brothers (TOL) surged more than 3% in Thursday pre-market trading after the company announced the acquisition of a California homebuilding business.
Shapell Industries will sell Toll Brothers its land portfolio, comprising roughly 5,200 sites, for $1.6 billion in cash. Toll Brothers launched operations in California in 1994. The Shapell portfolio will give it access to many high-growth, affluent markets in the state, Reuters notes.
Toll Brothers will finance the cash transaction with new debt and an existing credit line. The company also plans to sell properties in the portfolio valued at about $500 million early next year.
The company indicated that it now anticipates fourth quarter 2013 revenue of about $1.04 billion, above the $921.03 million that analysts had forecast.