Firm Could Buy Control of Peters Co. : Real estate: The tentative $47-million deal is between the Resolution Trust Corp. and Capital Pacific Homes.
Controlling interest in the J.M. Peters Co., valued at more than $110 million just three years ago, would change hands for $47.25 million under a tentative deal signed Monday.
The deal is between the federal Resolution Trust Corp. and Capital Pacific Homes Inc. in Newport Beach.
Dale Dowers, president of Capital Pacific, said his firm would become a holding company with Newport Beach-based J.M. Peters Co. as its development arm if the cash sale is completed as anticipated on July 1.
The Peters Co. acquisition would give Capital Pacific 2,000 residential lots, mainly in Orange, Los Angeles and Ventura counties; 60 completed but unsold homes, and 85.8%--or 12 million shares--of the company’s 13.9 million shares of common stock.
As part of the deal, Capital Pacific also would assume liability for the $126.5 million of Peters Co. debt held by the current majority owner, San Jacinto Savings Assn. in Houston, and for $18.3 million in accrued interest, for a total debt assumption of $144.8 million. That debt is secured by 1,400 of the lots.
Most of the 2,000 lots that Capital Pacific would acquire are graded and ready for construction. The bulk are in Orange County master-planned communities, among them Rancho Santa Margarita, Coto de Caza, Portola Hills, Mission Viejo, Foothill Ranch and the Newport Coast development just begun by the Irvine Co. Other lots are in developments in La Quinta, Glendale, Simi Valley and Calabasas.
In its annual report for the fiscal year ended Feb. 28, J.M. Peters Co. reported total debt of about $240 million. About $60 million of that was a disputed tax liability to San Jacinto that was recently forgiven by the thrift with RTC approval. Disposition of the remaining $35 million in debt was unclear Monday.
The RTC is handling the J.M. Peters stock sale as receiver for San Jacinto Savings.
J.M. Peters Co., founded in 1975, was considered the premier builder of luxury move-up homes in Southern California until its credit was cut off when San Jacinto was declared insolvent and seized by regulators two years ago.
Capital Pacific is a year-old firm started by Dowers and Washington-area builder Hadi Makarechian, who serves as chairman.
James M. Peters, founder and chairman of the company that bears his name, could not be reached for comment Monday.
Dowers said relations with Peters “are amicable” but would not say whether the well-known builder will remain with the company. He said any changes affecting the jobs of the company’s remaining 60 employees “are still to be determined.”
Dowers also said Monday that Capital Pacific does not intend to take the Peters Co. private by acquiring the remaining shares, which trade on the American Stock Exchange.
He declined further comment on the deal, but knowledgeable sources said the the proposed purchase would be financed by Toronto-based Canadian Imperial Bank of Commerce, one of Canada’s major banking institutions.
The bank is the same one that had agreed in late 1990 to finance Dowers and Makarechian in their aborted attempt to purchase Costain Homes, also in Newport Beach. Dowers was president of Costain at the time.
San Jacinto acquired the J.M. Peters Co. in a 1985 deal that netted James Peters more than $20 million. In 1987, San Jacinto took the building company public with an offering of nearly 2 million shares that raised about $12 million.
