Westlake Village home builder Ryland Group Inc. will merge with Irvine-based home builder Standard Pacific Corp., forming the country’s fourth-largest residential U.S. home developer.

The two companies’ respective boards of directors unanimously approved the stock transaction, which will leave Ryland shareholders with about 41 percent ownership of the combined company and Standard Pacific stockholders with 59 percent. The combined company will have a $5.2 billion market capitalization.

The new company will maintain a corporate presence in California as well as establish an office on the East Coast, but there was no word on the future of Ryland’s Westlake Village offices.

On a Monday morning conference call, the two companies’ chief executives said they had discussed a “merger of equals” for more than four years. They decided to execute the plan now to capitalize on what they believe is a growing demand for new homes across the country.

“We think we’re in the early innings of a recovery,” Larry Nicholson, Ryland’s chief executive said.

By combining forces, the new company will be able to maximize the run-up in the new home market, he said, adding that he and Standard Pacific Chief Executive Scott Stowell are extremely comfortable with the timing of the merger.

“We certainly don’t think it’s too early. In this market, the risk is that we would do it too late,” Nicholson said during the conference call.

After the merger, the combined company – which will get a new name and stock ticker – will control about 74,000 home sites in 17 states. They expect to realize savings of $50 million to $70 million, Nicholson said.

Stowell will become the combined company’s executive chairman and Nicholson will be its chief executive. The board will have 10 members, with five from Standard Pacific and five from Ryland.

Standard Pacific will implement a 1-for-5 reverse stock split, so that each five shares of Standard Pacific common stock will be combined into one share. After the reverse stock split, Ryland shareholders will receive 1.0191 shares of Standard Pacific common stock for each share of Ryland common stock. Fractional shares will be paid out in cash.

The companies announced the merger Sunday. Both firms’ stocks jumped on the news. Ryland shares closed at $45.02 Monday, up 5 percent on the day, while Standard Pacific shares closed the day at $8.83, up 6 percent.