As housing worsens, builders merge to survive

Pulte Homes, Inc. (PHM) and Centex Corporation (CTX), two of the largest home builders, are merging. It remains to be seen whether this move will save the companies during what is perhaps the worst downturn in the market in over a century.

The companies announced that they had entered a definitive merger agreement under which Pulte and Centex will combine in a stock-for-stock transaction valued at $3.1 billion, including $1.8 billion of net debt.