Standard-Pacific Moves Toward Reorganization

Standard-Pacific Corp. said it filed a registration statement with the Securities and Exchange Commission on Monday in its bid to reorganize as a limited partnership--just two days after a congressional panel decided not to eliminate the tax benefits of such a change in its bill.

Under existing tax law, the Costa Mesa home builder’s proposed move would help the company reap savings by avoiding double taxation on profits and dividends it currently must pay as a corporation. As a limited partnership, only shareholders’ dividends would be taxed.

The timing of the move--which comes the first business day after House and Senate conferees passed their tax reform package--is “coincidental,” said Robert J. St. Lawrence, Standard-Pacific’s chief financial officer.

“It wasn’t planned that way. It just turned out that way,” St. Lawrence said. “We certainly feel a lot more comfortable now, though,” because of the weekend actions in Congress.

Company executives decided in May to forge ahead with its reorganization plans regardless of how the final tax package might treat the issue. The current bill, which would pave the way for Standard-Pacific to cash in by reorganizing, still must be approved by the full House and Senate in September.

The Treasury Department’s initial tax overhaul plan--and some versions circulating on Capitol Hill--effectively would have eliminated those benefits by taxing the difference between book and market value upon liquidation of the corporation, analysts have said.

St. Lawrence said he anticipates that shareholders will vote on the reorganization proposal in late October or early November.