Japan’s Sekisui House to buy US homebuilder MDC for $4.95 billion

TOKYO (Reuters) -Japanese homebuilder Sekisui House said on Thursday it has struck a deal to buy Denver-based builder MDC Holdings <MDC.N> for about $4.95 billion in cash, to become the fifth-biggest homebuilder in the United States.

Sekisui said in a statement it would pay $63 per share in MDC, about a 19% premium to MDC’s closing price on Wednesday. MDC shares rose 16% in premarket trading after the announcement.

Acquisition of MDC will double Sekisui’s presence in the U.S. to 16 states and quicken the achievement of its goal of delivering 10,000 homes annually in overseas markets by 2025, Sekisui’s chief executive Yoshihiro Nakai told a press conference.

“Participation of MDC to our existing group of builders will make us unmatched in the U.S. housing industry,” Nakai said.

“As part of Sekisui House’s U.S. family of brands, we expect new opportunities for growth across our footprint for our team members and within our customer offering,” MDC’s chief executive David Mandarich said in a statement.

Sekisui is examining the deal’s impact on its earnings forecast for the next financial year starting in February but will stop conducting share buybacks, Nakai said.

The move followed the top Japanese steelmaker Nippon Steel’s $14.9 billion deal last month to buy U.S. Steel.

(Reporting by Rocky Swift and Kantaro Komiya; editing by Jason Neely and Chizu Nomiyama)