Sekisui House acquires M.D.C. Holdings in $4.9bn deal to expand U.S. market presence

Sekisui House, Ltd. (TSE:1928), through its subsidiary SH Residential Holdings, LLC, part of the Sekisui House US Holdings, LLC, has successfully completed the acquisition of M.D.C. Holdings, Inc. (NYSE: MDC), a prominent U.S. homebuilder. The transaction was finalized at $63.00 per share, summing up to an equity value of approximately $4.9 billion. This acquisition marks a milestone as Sekisui House aims to strengthen its footprint in the U.S. real estate market, with the deal officially closing on April 19, 2024. Following the acquisition, MDC will be delisted from the New York Stock Exchange.

The integration of MDC into the Sekisui House Group—which includes Woodside Homes, Holt Homes, Chesmar Homes, and Hubble Homes—increases the group’s annual supply to around 15,000 units across 16 states. This expansion significantly contributes to Sekisui House’s goal of delivering 10,000 detached homes in overseas markets by fiscal year 2025, positioning the company ahead of its strategic schedule.

Yoshihiro Nakai, President, and CEO of Sekisui House, expressed excitement about the acquisition, stating, “Today marks a significant advancement of our strategy to expand in the U.S. and bring the value of our philosophies and technology to U.S. homebuilding.” Similarly, Toru Tsuji, CEO of SH Residential Holdings, highlighted the commitment to increasing the availability of high-quality, environmentally friendly homes in the U.S., aligning with the company’s vision of making homes the happiest places in the world.

Larry Mizel and David Mandarich from M.D.C. Holdings shared their positive outlook on the acquisition, noting, “After 50 years of standalone growth, today marks an incredible new chapter for MDC as part of Sekisui House to position MDC for another 50 years of success.”

The acquisition saw the involvement of Moelis & Company LLC and Mitsubishi UFJ Morgan Stanley Securities as financial advisors, with Morrison Foerster LLP acting as a legal advisor for Sekisui House. MDC utilized the expertise of Vestra Advisors, LLC, and legal services from Paul, Weiss, Rifkind, Wharton & Garrison LLP and Brownstein Hyatt Farber Schreck, LLP.

Sekisui House, a leader in ESG management, continues to impact the global housing market positively, having delivered over 2.66 million homes worldwide. M.D.C. Holdings has been instrumental in providing quality homes to more than 240,000 homebuyers through its Richmond American Homes brand since 1977.

This acquisition by Sekisui House not only signifies a strategic expansion into the U.S. housing market but also showcases a robust approach to integrating high-quality homebuilding practices with a focus on sustainability and innovation. The move is set to create substantial growth opportunities within the U.S. market, leveraging advanced Japanese technologies and philosophies in homebuilding.