Weyerhaeuser Company · NYSE:WY
Weyerhaeuser — Merger or Acquisition (June 2014)
35 slides from Weyerhaeuser's merger presentation, Jun 9, 2014
Slide 1: Building a Best-in-Class Homebuilder
Filed by: Weyerhaeuser Company Pursuant to Rule 425 under the Securities Act of 1933 Subject Company: Weyerhaeuser Company Commission File No.: 001-04825 “Building Investor June 2014Presentation a Best-in-Class Homebuilder”
Slide 2: Forward-Looking Statements
Forward This current other events we update Some “anticipates,” looking Weyerhaeuser’s Weyerhaeuser These uncertainties and related prospects; Pointe’s factors 2Consequently, will TRI presentation factors, forward-looking statements occur, or transactions; described expectations proceed statements b
Slide 3: Additional Information and Where to Find It
Additional In Weyerhaeuser, required holders from Washington Attention: Tender On as by Weyerhaeuser Company, Participants This (“Weyerhaeuser”). connection Securities the relating 3and connection part Weyerhaeuser TRI May indirect presentation the of Offer are to Pointe’s 22, in SEC’s the and Inves
Slide 4: Transaction Overview
Transaction Overview Weyerhaeuser Real Estate Company
Slide 5: Transaction Summary
In November (“Weyerhaeuser”) TRI Weyerhaeuser part shareholders — The Top 2013 Growth-oriented, Transaction (1) outstanding (3) 5GAAP Anticipate Corporate Central Excluding Expected 10 of combined Pointe combined the Financial homebuilder transaction functions will equity Summary combines targeted e
Slide 6: Key Transaction Terms and Pro Forma Ownership
KeyAssumes Structure Consideration and Pro WRECO Ownership Barry Board TRI Dan CEO: Management CFO: Headquarters Transaction closing Conditions Expected Weyerhaeuser vote (1) 6~40.0% Forma approximately Pointe Transaction Fulton, isMichael Sternlicht Doug will of required conditions, toDirectors and
Slide 7: The Exchange Offer
The Investors To Weyerhaeuser convert Offer –stock will Approximately of Upper Exchange Average common York offer Valuation Expiration 7(1) At Weyerhaeuser Exchange Exchange be the (the Stock toLimit converted automatically closing Exchange Based of shares Eligible “Valuation Dates Ratio 12:00 the E
Slide 8: Company Overview
Company Overview Weyerhaeuser Real Estate Company
Slide 9: Best-in-Class Management Team
Best-in-Class Working large, Barry •Chairman Chairman Capitalgeographically S./Group Former William Starwood Operational Pardee Tom Lash, Combined Industry: 340 Employees (1) 9years Current Tom 155 Sternlicht together TPHof Mitchell, at & Lyon 135 the 75(1)Executive and Chairman Hotels Property Yrs
Slide 10: TRI Pointe Overview
TRI Founded Overview 17 Next focused Backed $150mm Expanded Completed 2013 of Headquartered CA Geographic Closings: Lots: Key Lots Years Inventory 3/31 Employees Operating As LTM 4% Colorado 51% Southern 27% Northern 16% California 69% 440 (1) (3)growth (2) data year 10 years of Colorado and Units A
Slide 11: WRECO Overview
WRECO Founded Overview the Operates K Empire, Richmond, T each –E Extensive proposition value selling Geographic Closings: Lots: Key Lots Years Inventory 3/31 Employees Operating As LTM Winchester 13% Maracay 7% Trendmaker 17% 20% Quadrant Pardee 12% 2,984 Source: (1) (3) data year 11 ailored ach ey
Slide 12: Top National Homebuilder At-A-Glance
••Combined Key ($ Lots LTM Net (4) Top Pro Source: Note: (1) (3) 10 SeeCompany forma Inventory(2) Shareholder’s Credit national Significantly Approximately Debt-to-Capital 12 inBased Debt or as balance Debt-to-Capital(4) Metrics Owned millions) Total Closings Homebuilding Data Statistics: Company Ex
Slide 13: Leading Combined Markets
Leading San Denver Empire, Markets: LTM Lots Combined Note: 13 Diego, Owned Single-Family All Market: San Brand Orange Los Phoenix, lots Lots San or Diego, Angeles/Ventura, owned Names Controlled: Francisco Owned Greater County, Tucson Las Closings: orTargeted or controlled Vegas Puget Los Bay Contr
Slide 14: Synergy Opportunity
Synergy We Additionally, Purchasing Centralized Strategic teams 14 expectOpportunity opportunity to leverage administrative achieve there iswith ais exists annual significant Meaningful increased functions tosynergies apply opportunity scale key in of Irvine homebuilding $21mm HQ, to enhance by redu
Slide 15: Investment Highlights
Investment Highlights Weyerhaeuser Real Estate Company
Slide 16: Investment Highlights
21TRI Product Growth (1) 16Best-in-Class Significant Pointe Markets Enhance Based &Land WRECO: on Management 7Strong 161,332,533 Development Supply A Partnerships Powerful to Fuel Team shares Capabilities Growth Forming Combination With outstanding at Land athe and Top Right Owners Operating and aft
Slide 17: Creates Top 10 National Homebuilder
1Creates Equity $7.2 $8.5 $9.1 $6 $2.9 $5.2 $2.0 LEN LTM Companies 18,290 25,712 7,190 11,773 #12 5,316 DHI Source: (1) closing 17 4. Excluding #7 $2.7 $1.5 LEN DHI Closings 7,102 4,650 Market 17,369 and Top Company $2.5 $1.4 PHM with TPH 6,398 4,565 10shares $1.4 Capitalization National TOL NVR mar
Slide 18: Significant Land Supply to Fuel Growth
218 As of TRI Market Total 8% Significant Geographic Texas Washington Washington, Southern Arizona 7% Nevada 6% Combined California Northern 2% Colorado 10% D.C. Based 9.0 10.9 8.6 7.6 7.1 TOL 3.5 4.8 5.4 6.1 Note: (1) 3,424. Includes Median: 8.4 7.5 6.8 Pointe PF 2,509 March Excludes — 4% on Owned
Slide 19: Housing Affordability Remains High
…Affordability High Low –All-Time U.S. (in 1970 0.2 0.4 0.6 0.8 1.0 1.2 1.4 Monthly, 14 New 6Supply 2Months 2001 Housing Quarterly, TM Affordability 4.0 6.0 Burns 0.0 Index (mortgage housing Source: 2014). 19As New 2.4 Rental 600 200 At 1,400 millions) 10.0 New of Supply Home Demand jobs 1973 2002 t
Slide 20: Complementary California Footprint
3Ventura Primary Northern Los TRI Southern Inland San PARDEE ~2,900 ~75% growth Strong builders 20 Complementary Predominantly Merchant cash California ~16,500 Seasoned development LandAngeles Diego POINTE flow position owned Empire and positions lots, and and California lots, California team builde
Slide 21: Important Land Owner and Developer
421 Important Diverse product Entitlement, Existing TRIland PointeLand Owner expertise development andExisting Relationships and premium and Developer community brands Partnerships WRECO will planning continue Relationships expertise, to makewhich the combined adds valuecompany to land through an at
Slide 22: Move-Up and Lifestyle Builder Focus
522 Average (Last $422 $449 $525 $694 $377 $327 TOL $271 U.S. 100– 0% 5% 10% 15% 20% 25% $D Dist. Quality TRI Chantrea, Level Executive Woodson, Move-Up Sendero, Detached Rancho Aldea, Attached Entry-Level Source: Clarita Lifestyle istribution 150KPointe 5-Year PF of Median: $366 $317 150– Reported
Slide 23: Leadership Positions in Markets
623 Leading Overall Location Pardee LA Inland Las Maracay Phoenix Quadrant Trendmaker Winchester Southern Northern Denver, Long John 25% 19% 15% 8% 6% San 5% Dec. Housing Based 22% 27% 45% 51% 60% 68% Houston 16% Seattle D.C. Source: County 9% 6% Vegas Diego Leadership Washington, TRI Pointe 24% 22%
Slide 24: Attractive Gross Margin Profile
724 LTM Companies 22.2% 22.8% 24.8% 25.8% 17.4% 18.2% 20.5% SPF Source: (1) LEN Attractive Entitlement Long enhance Homebuilding land 22.0% margin position with and21.7% 17.2% Company Excludes MTH PF Gross profile development market enables Gross purchase filings. TPH Margin 21.7% (1) Profile capita
Slide 25: Prudent Capitalization
825 78.9% forma 48.4% KBH 28.4% 31.1% 39.3% 42.3% Source: Note: (1) SPFPrudent ProDebt-to-Capital Expected Most Debt-to-Capital(1) 52.3% 58.0% recent 51.1% new 47.9% Balance Based LEN Capitalization Debt-to-Capital quarter; revolving 46.9% sheet onRYL Companies last equal data MDC credit toratio 46.
Slide 26: Financial Overview
GEMPointe Financial Overview
Slide 27: Combined Financial Summary
%% Combined Home 1,948 2,458 $1,466 3,335 $782 Homebuilding ($ 2011 $95 $170 $190 $157 $207 $322 21.7% in Marginmillions) millions)($ 2012 Source: (1) (2) (4) +31% 27 $948 Closings(1) 20.1% Financial 2013 Margin CompanyGross Excludes Adjusted Excludes CAGR 22.0% 2011 infee EBITDA Home millions) Summ
Slide 28: 1Q TRI Pointe Key Financial Highlights
(1) 1Q TRI ($ Orders Closings ASP Total Pre-Tax Key Significant growth Average Backlog Higher revenue Increased 28 in2014 Pointe Highlights ($ millions) Revenue Gross 138 homebuilding inIncome and Excludes closing declined Financial 92 ASP market community 000’s) increase WRECO 123 Margin 48 increas
Slide 29: Transaction Pro Forma Balance Sheet
Transaction –On Balance All Proposed $348 WRECO Pro TRI Standalone ($ Cash Existing New Total Stockholders’ Credit Debt-to-Capital(5) Debt Net Source: (1) 29$450 (2)in June intercompany Forma Debt-to-Capital(5) Debt credit debt (4) Pointe millions) Revolver Senior /million and Debt Financial LTM Sta
Slide 30: Conclusion
Conclusion Weyerhaeuser Real Estate Company
Slide 31: Conclusion: Creating a Top 10 National Homebuilder
TRI 10 Top Growth (1) 31 Pointe BalanceNational at Based the & WRECO: Sheet Right onHomebuilder 161,332,533 Point Ato Structured in Powerful the with shares HaveHousing Expected Combination outstanding Recovery ConservativeCombined and and Portfolio Strong TPH Leverage Equity andclosing of FitMarket
Slide 32: Appendix
Appendix
Slide 33: Board of Directors
Board Barry Douglas TRI Lawrence Daniel Kristin Steven Christopher Constance Thomas Age Chairman the Prior private SVP President, Currently, development Previously, Currently companies Senior Starwood Director holds Executive California (1) 33 To past Pointe’s Pointe 61 46 65 39 58 74 of to over S.
Slide 34: Reconciliation of Non-GAAP Financial Measures
Reconciliation In measures performance comparable The earnings (a) TRI Net EBITDA($3,566) WRECO Fiscal ($ Earnings Less: EBITDA Adjustments: Plus: Adjusted (1) data December 34 this in impairments As Income following Pointe for thousands) Amortization Gain Interest Provision Depreciation Coyote Rest
Slide 35: Reconciliation of Non-GAAP Financial Measures (cont'd)
Reconciliation The leverage As Pro ($ Debt Less: Net Equity Total Ratio (1) 35 (2)inof Forma Debt-to-Capital debt following thousands) $176,933 capital cash of March financial The 326,867 The debt-to-capital net employed 144,887 and ratio debt-to-capital $503,800 $471,754 ratio 31, measure oftable o