SECURITIES AND EXCHANGE COMMISSION
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DEL WEBB CORPORATION
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(Name of Registrant as Specified in Its Charter)
PACIFIC PARTNERS, LLC
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<PAGE>
NEWS RELEASE
FOR IMMEDIATE RELEASE
CONTACT: Denise D. Resnik
(602) 956-8834
DEL WEBB'S POOR PERFORMANCE DRIVES
PACIFIC PARTNERS' PROXY FIGHT
PHOENIX (October 25, 2000) - Poor stockholder returns and entrenched
management are the issues driving a proxy fight for two seats on the board of
Del Webb Corp. (NYSE:WBB). Pacific Partners, LLC, a private investment group,
announced that retirement community developer Del Webb ranked dead last in terms
of stockholder returns among similar homebuilding companies. Del Webb ranked No.
11 out of 11 companies with a five-year total return of negative 32 percent; 10
out of 11 with a three-year total return of negative 4.7 percent; and 10 out of
11 with a one-year total return of negative 35.9 percent. See chart below:
Total peer group ranked by one-, three- and
five-year returns through
June 30, 2000
<TABLE>
Debt/Book 1 year total 3 year total 5 year total
Company Capital return return return
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<S> <C> <C> <C> <C>
CENTEX CORP 58.0% -37.1% 17.4% 70.9%
D R HORTON INC 60.5% -17.5% 33.7% 57.3%
HOVNANIAN ENTRPRS INC 65.4% -31.4% -5.9% 3.2%
KAUFMAN & BROAD HOME CORP 66.8% -19.3% 17.5% 48.3%
LENNAR CORP 62.2% -15.3% 66.0% 188.9%
MDC HOLDINGS INC 40.8% -12.3% 108.0% 217.6%
PULTE CORP 45.9% -5.6% 27.5% 60.1%
RYLAND GROUP INC 65.2% -25.0% 60.1% 52.1%
STANDARD PACIFIC CP 48.1% -21.1% 2.8% 58.7%
TOLL BROTHERS INC 54.2% -4.4% 11.6% 28.1%
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Arithmetic average 56.7% -18.9% 33.9% 78.5%
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DEL WEBB 67.6% -35.9% -4.7% -31.9%
</TABLE>
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The companies in the survey are the same as those used by Del Webb in
constructing its total return to stockholder chart found on page 15 of its proxy
statement dated September 22, 2000, except for the inclusion of MDC Holdings,
Inc. MDC's principal line of business, geographic areas of operations and its
product price points are similar to those of Del Webb's. The returns are
measured through June 30, 2000, the end of Del Webb's fiscal year and consistent
with the performance graph included in Del Webb's proxy statement.
Del Webb's Shaky Foundation
Del Webb has stated that they have laid the foundation for the
company's future growth. However, Pacific Partners believes Del Webb's heavy
debt load and high operating costs have resulted in the firm's poor historical
performance in terms of generating returns to stockholders and achieving greater
profitability.
Pacific Partners owns in excess of 1 million shares of common stock or
5.49 percent of Del Webb. "We're long-term investors concerned about the future
of Del Webb," explained Garth Wieger, a principal of Pacific Partners and CEO of
Journey Homes based in Scottsdale, Ariz. "We haven't sold a single share. We
would like the company management to be responsive to stockholders, the true
owners of Del Webb."
Pacific Partners believes that its campaign is starting to have an
impact. "As a result of our criticism, we understand that Del Webb is now
amending a proposed new management equity incentive plan to clarify that options
granted under the proposed plan may not be effectively re-priced. In addition,
after we filed our papers for our proxy campaign Del Webb apparently revisited
J.F. Shea Company's offer to purchase Del Webb; an offer that had been dubbed as
"deficient in many ways" by Del Webb CEO LeRoy Hanneman when it was first
publicly disclosed on September 25, 2000," Mr. Wieger said.
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Pacific Partners met with Del Webb management and made several
substantive recommendations including: |X| the creation of smaller communities -
compared to Del Webb's current strategy of developing massive
communities -- that require smaller initial investments in infrastructure;
|X| the leveraging of the Del Webb brand name through
partnerships, joint ventures and licensing arrangements with
other builders and business entities;
|X| the need to streamline operations to reduce SG&A expense in
an appropriate manner to be more inline with peer group
comparables;
|X| establish recurring sources of revenue such as continued
ownership of commercial properties and other aspects of
communities developed by the company.
"By shining a bright public light on the weaknesses of Del Webb, I
believe that Pacific Partners has already made a contribution to the
stockholders of the company," Mr. Wieger said. "Once on the board, our nominees
are committed to seeking out and investigating all reasonable alternatives for
maximizing stockholder value and operating the company in a more efficient and
profitable manner. As a long-term investor, Pacific Partners will continue to
make every effort to ensure that Del Webb moves in a direction that we believe
will maximize returns to stockholders.
Experience of Pacific Partners' nominees
Pacific Partners is soliciting proxies for use at Del Webb's annual
stockholders meeting, scheduled for November 2, 2000, for the purpose of
electing two Pacific Partner nominees to Del Webb's board of directors and to
vote against two management compensation programs.
Pacific Partners' board nominees are successful businessmen with proven
track records. William S. Levine is the manager of Pacific Partners and chairman
of Infinity Outdoor, Inc. As board chairman of Outdoor Systems, Inc. (now
Infinity Outdoor), an outdoor media firm, Mr. Levine was deeply involved in the
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company's growth through acquisitions and interfaced regularly with financial
sources and Wall Street. From its initial public offering in 1996 until its sale
in December 1999 to Infinity Broadcasting Corporation, the stock of Outdoor
Systems increased more than 2,400 percent. The sale of Outdoor Systems to
Infinity Broadcasting was in excess of $8 billion.
Brian J. O'Connor is senior vice president of Hutchison, Shokey, Erley
& Co., a financial services company. He has extensive experience in financial
matters, including tax-free infrastructure financing. Pacific Partners believes
that Mr. O'Connor would be a strong and independent director and he has no
financial interest in Pacific Partners. Together, Mr. Levine and Mr. O'Connor
will use their collective experience and high performance standards to ask tough
questions and expose senior management to new horizons and new paradigms to
assist the directors in making sure that the Del Webb board makes decisions that
are in the best interest of the company and its stockholders.
A partner of Pacific Partners, Auturo R. Moreno, president and CEO of
Outdoor Systems (now Infinity Outdoor), directed and managed a company, which
became the largest billboard company in the United States, Canada and Mexico.
In addition, two principals of Pacific Partners are respected
homebuilding executives with a combined 40 years of hands-on experience in
starting and successfully managing large conventional and active adult
homebuilding entities. They are Mr. Wieger, CEO of Journey Homes, and Joseph
Contadino, owner of Universal Homes. Mr. Wieger was president and CEO of UDC
Homes from 1996 to 1998. Following the acquisition of UDC by Shea, he served as
COO of Shea Homes.
Mr. Contadino joined Del Webb after his company, Coventry Homes, sold
to Del Webb in late 1990. He was appointed executive vice president of Del Webb
early in 1996.
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Support a Mandate for Change
Although the current Del Webb directors have 72 total years of service
to Del Webb, they (a) own less than 1 percent of the outstanding common stock
(excluding shares held subject to unexercised options) and (b) are responsible
for the business plan and corporate culture that has produced the poor financial
results for stockholders mentioned above. Mr. Levine of Pacific Partners has a
direct financial interest in approximately 424,000 shares of Del Webb common
stock, more than twice as many as all of the Del Webb directors combined
(excluding unexercised stock options). Mr. O'Connor owns 2,000 shares, twice as
many shares as the two outside incumbent directors currently up for election
(again, excluding unexercised stock options) and more than any other director
except Peter A. Nelson (16 years of service; 7,000 shares) and Sam Yellen (9
years of service; 2,000 shares).
"It's time to have board members whose interests are truly aligned with
those of all other Del Webb stockholders," Mr. Wieger said.
Pacific Partners asks all Del Webb stockholders to review the Pacific
Partners proxy statement dated October 19, 2000 carefully. The Pacific Partners
nominees for directors are committed to investigating all opportunities for
maximizing stockholder value, including Shea and others that may become
available. "While our nominees, if elected, will not constitute a majority of
the Del Webb board, we believe that the election of our nominees should be
recognized by the other directors as a mandate for change. Even as a minority
presence, they will be an active presence committed to pursuing avenues designed
to deal with current challenges that we believe are impeding the company's
financial flexibility and greater profitability," Wieger said.
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TIME IS SHORT. THE ANNUAL MEETING IS NOVEMBER 2.
VOTE YOUR BLUE PROXY CARD TODAY.
By now, Del Webb stockholders should have received Pacific Partners'
Proxy Statement and the enclosed BLUE Proxy Card to be used for voting for
Pacific Partners' nominees.
REMEMBER: EVEN IF YOU HAVE ALREADY VOTED A PROXY CARD IN FAVOR OF
MANAGEMENT'S NOMINEES, YOU HAVE EVERY LEGAL RIGHT TO CHANGE YOUR MIND AND VOTE A
BLUE PROXY CARD FOR PACIFIC PARTNERS' NOMINEES. ONLY YOUR LATEST DATED PROXY
CARD WILL COUNT IN THE FINAL TALLY.
Your vote is very important. If you have any questions about voting,
please contact D.F. King & Co., Inc.
D.F. King & Co., Inc. - 1-800-207-2872
or
[email protected]
Please Vote Today
Information regarding the identity of the person who, under SEC rules,
may be deemed to be participants in Pacific Partners' solicitation of Del Webb's
stockholders, and their interests in the soliciation, are set forth in Pacific
Partners' definitive proxy statement filed October 19, 2000 with the SEC. Copies
of the definitive proxy statement are being mailed to Del Webb's stockholders.
Stockholders are urged to read the Pacific Partners proxy statement and any
other relevant documents that may be filed with the SEC because they contain
important information. All of these materials are available free of charge at
the Pacific Partners Web site (www.pacificpartners.bizland.com). Stockholders
can obtain copies of these documents free of charge at the SEC's Web site
(www.sec.gov). Copies are also available free of charge from D.F. King & Co.
Inc. at 1-800-207-2872 or [email protected]. Stockholders should read the
Pacific Partners proxy statement carefully before making any voting decisions.
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