ConDig (06-Jun-17).  Fort Worth, Texas-based homebuilder D.R. Horton has tabled a $520 million bid for a 75% stake in residential developer Forestar Group.

The move by the biggest homebuilder in the US has trumped an offer for Forestar by Starwood Capital Group, which agreed to acquire the Texas-based real estate developer in April.

D.R. Horton said its offer of $16.25 per share represents a 14% premium over the $14.25 offered by Starwood.

Forestar said in a statement late on Monday it would review D.R. Horton’s offer and that it had not yet determined if the proposal was superior to the proposed bid by Starwood.

Under the proposed transaction, D.R. Horton said that Forestar would remain a public company to ensure continued access to capital to support the increasing scale of the business.

“We believe that D.R. Horton is uniquely positioned to make Forestar the country’s leading residential land development company. Together, we can grow Forestar into a much more significant and valuable company for all of its stockholders,” said Donald R. Horton, chairman of the board.

“The Forestar proposal is a continuation of D.R. Horton’s stated strategy of expanding relationships with land developers across the country and growing the optioned portion of its land and lot position to enhance operational efficiency and returns.”

He urged the board members of Forestar to act quickly on the offer, which it believes is in the best interests of their stockholders.

D.R. Horton posted net income of $229.2 million for the quarter ended March 31 2017 compared to $195.1 million in the same period last year and was also up on profit of $206.9 million in its fiscal first quarter.

Revenue for the second quarter rose 17% to $3.2 billion from $2.7 billion in the same quarter of fiscal 2016 and was also up on revenue of $2.8 billion in the prior quarter.