Effective September 1, 2009, Cavalier Homes, Inc., a publicly-traded manufacturer of mobile homes and long-standing client of the firm, consummated its sale to Southern Energy Homes, Inc. for approximately $48.5 million in cash. The sale was the culmination of a series of major corporate actions by Cavalier and its board of directors that began in the fall of 2007 with the engagement of Avondale Partners to assist in reviewing strategic alternatives and included a hostile proxy contest that commenced in January of 2009 and concluded in May of 2009.
The sale also involved an unusual action by the Federal Trade Commission, which decided to review the merger although a Hart-Scott-Rodino filing was not required. On the day of the special meeting of Cavalier’s stockholders to approve the merger, representatives from the FTC contacted representatives of Cavalier and Southern Energy regarding a review of the possible anti-competitive effects of the merger, given industry consolidation and the dominant market position of Clayton Homes, the parent company of Southern Energy. Prior to this call from the FTC, the parties were scheduled to close the transaction the following morning.
Bradley Arant Boult Cummings provided antitrust counsel, worked with Cavalier to provide responsive market and operating data to the FTC, coordinated Southern Energy’s responses to the FTC with their Washington, D.C. antitrust counsel, and provided additional counsel over the next two weeks to assist with the resolution of the FTC inquiry in order to permit the merger.