Lennar Corporation announced that it has completed the final phase of its share‑swap with Millrose Properties, Inc., exchanging 33,298,754 Millrose shares for 8,049,594 Lennar Class A shares at a proration factor of 8.604228%. The offer, which expired at midnight on November 21, 2025, was oversubscribed and the exchange will be settled on a pro‑rata basis for all validly tendered shares, with unaccepted shares returned to shareholders.
The transaction represents the culmination of Lennar’s long‑term asset‑light strategy, which began with the February 2025 spin‑off of Millrose as a real‑estate investment trust. By exchanging its remaining stake in Millrose for Lennar shares, the company reduces its exposure to land assets while providing Millrose shareholders with a direct equity position in Lennar’s core home‑building business. The move is intended to streamline the balance sheet, lower capital intensity, and enhance cash‑flow generation for future growth.
Lennar’s Q3 2025 financial results provide context for the swap. Net earnings fell to $591 million, or $2.29 per diluted share, down from $1.20 billion ($4.26 per share) in Q3 2024, reflecting a 17.5% gross margin on home sales versus 22.5% the prior year. The decline is driven by lower revenue per square foot and higher land costs, underscoring the need for a more efficient capital structure. The share‑swap is therefore a strategic response to these headwinds, aiming to preserve profitability while maintaining access to land for future development.
Market reaction to the announcement was positive, with analysts noting that the exchange signals a decisive step toward de‑risking Lennar’s balance sheet. The move is seen as a value‑unlocking event for shareholders, particularly odd‑lot holders who can exchange Lennar shares for Millrose shares at a premium. The asset‑light pivot is expected to improve capital efficiency and support long‑term earnings growth, aligning investor expectations with the company’s strategic objectives.
Executive Chairman and Co‑CEO Stuart Miller emphasized that the transaction “strengthens Lennar’s focus on core home‑building operations while preserving the strategic partnership with Millrose.” He added that the company remains committed to disciplined cost management and controlled home‑site acquisition, positioning Lennar to navigate the current market environment and capitalize on future demand.
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