So, there is some news happening in the normally, relatively staid world of home building. Bill Pulte, who started what has become one of the biggest home building companies in the country, decided to fight his old company to force them to fire its current CEO. With his grandson of the same name and another director from the board, Pulte is trying to pressure PulteGroup CEO Richard Dugas to quit, citing bad management and company direction. The board, except for the lone director who has decided to side with the Pulte family, disagrees, feeling that Dugas has admirably guided the company back to profitability since the housing and financial crash from 8 years ago.
Regardless of who is right and wrong in this fight, it’s not a good position for the company to be in. As Builder editorial director John McManus writes: “Uncertainty and limbo start a guessing game about who's in line as a Dugas successor? Is he or she ready? Will that person come from inside or outside the company? How will PulteGroup attract a top-flight CEO in the wake of a Dugas ouster? Is PulteGroup now in play, given the questions around its leadership, its ability to sustain and grow value?”
Despite all of those questions, and what becomes of the fight for control, McManus writes that “A reality check here is this: Pulte closed 17,000-plus homes in 2015, with 13% pre-tax margins, and net income of $500 million on revenue of $5.8 billion. Richard Dugas, and his current team of innovators and operators, have nothing to be ashamed of in their performance.”
Read John McManus’ full article at Builder.