NEWHALL LAND OWNER ACQUIRED LNR PROPERTY CORP. BOUGHT FOR $2 BILLION.

Byline: Staff and Wire Services

SANTA CLARITA - A business that owns half of The Newhall Land and Farming Company was acquired for about $2 billion by a New York-based investment firm and one of its affiliates.

LNR Property Corp. agreed to the acquisition by Cerberus Capital Management LP and its affiliate, Blackacre Institutional Capital Management LLC, which will form Riley Property Holdings LLC to buy the Miami-based commercial-development company, LNR officials said late Sunday.

The sale will give Riley a 50 percent stake in Newhall Land. LNR and Miami-based home builder Lennar Corp. bought the local developer for $990 million last year.

Newhall Land spokeswoman Marlee Lauffer said the deal will not affect local operations, as the Valencia master builder prepares construction of the first phase of its 21,000-home Newhall Ranch project.

``It'll still be status quo here in Newhall Land,'' she said Monday. ``It'll not have any impacts as to our day-to-day operation. ... Much of the personnel that's currently at LNR will stay. The exact same focus and management will continue to guide the company.''

LNR was spun off from Lennar in 1997. It employs about 465 people and had sales of $435 million last year.

Riley will pay $63.10 in cash per share to buy all of LNR's outstanding stock, including options. LNR shares closed Monday at $62.81, up $3.71, or 6.28 percent, from $59.10 Friday.

Riley also will take on about $1.8 billion in LNR debt. The merger is expected to be completed by year's end or early next year, pending regulatory approval.

LNR's board voted unanimously to recommend the deal to shareholders, and its majority owners also agreed to the purchase. LNR Chairman Stuart A. Miller and his family partnerships and a trust control 77 percent of LNR's voting power.

``LNR will continue to grow and expand into new ventures with a group that has a proven track record of selecting investments that have excellent growth potential,'' Miller said.

The merger agreement precludes LNR from soliciting other proposals but allows it to consider unsolicited offers.

Miller, the partnerships and trust agreed to buy 20.4 percent of Riley, and other LNR management will buy an additional 4.6 percent of Riley. LNR chief executive Jeffrey Krasnoff will continue in that post at Riley.