The assumption that high profile investor Warren Buffett’s Berkshire Hathaway Inc. would make more acquisitions in the manufactured housing industry was well-founded because Oakwood Homes Corp. announced today (Nov. 25) it will sell its operations and non-cash assets to Clayton Homes Inc., which Berkshire purchased earlier this year.
Oakwood, which is in Chapter 11 bankruptcy, agreed to sell to Clayton for around $373 million in cash.
The deal needs to be approved by the Bankruptcy Court, Oakwood’s creditors and federal regulators, who will rule on whether a Clayton/Oakwood combination would violate anti-trust laws.
However, both companies believe the transaction will be finalized by next March 31.
The transaction could have an impact on the Elkhart County, Ind., economy because Oakwood acquired Middlebury, Ind.-based Schult Homes Corp. during 1998. Among the brands Oakwood continues to build are Schult, Marlette and Crest.
Berkshire’s acquisition of Clayton, which was finalized last summer, led to speculation, based upon Buffett’s reputation as a savvy investor, that the manufactured housing industry was poised for an upturn.
The Clayton acquisition also helped boost the stock prices of Fleetwood Enterprises Inc. and Skyline Corp., two RV manufacturers with significant involvement in manufactured housing.