Japanese homebuilder Sekisui House Ltd. announced plans to buy Denver-based MDC Holdings, Inc., which has built Colorado homes under the Richmond American Homes moniker for almost 50 years, in a $4.9 billion deal.

That’s according to a joint news release Thursday that outlined the terms of the all-cash buyout. 

MDC (NYSE: MDC) began in Denver in 1972 and is one of Colorado’s top publicly traded companies. It generated net income of $107.3 million in the third quarter, when the latest numbers were available. 

Sekisui, based in Osaka, Japan, has built more than 2.62 million homes worldwide since it was founded in 1960. 

The deal calls for MDC shareholders to get $63 per share “which represents an approximately 19% premium to MDC’s closing stock price on January 17, 2024,” according to the news release. 

The company’s stock prices soared after the announcement, from $53.10 on Wednesday to $62.70 to open Friday, according to the NYSE. That’s the stock’s highest price since $61.67 on April 11, 2021. 

“Over the past half-century, our unwavering commitment to excellence has been the cornerstone of our success, benefiting customers, employees, business partners and shareholders,” Larry Mizel, MDC’s founder and executive chairman, said in the release. “In our remarkable journey, marked by the construction of over 240,000 homes, we’ve emerged as a top 10 homebuilder in the United States.”

When the merger is finalized, likely “in the first half of 2024” pending approval of MDC’s stockholders and regulatory approvals, the new company will be the fifth largest homebuilder in the U.S. The boards of both companies unanimously approved the buyout. 

“This exciting acquisition of MDC represents a significant advancement of the Sekisui House strategy to expand our U.S. presence and bring the value of our technology, innovation and philosophies to U.S. homebuilding and ultimately to our customers,” CEO Yoshihiro Makai said in the release. Makai is the representative director of the board president and executive officer. 

Despite MDC’s revenues falling in the third quarter, from $1.41 billion in Q3 2022 to $1.09 billion, the company remained profitable. It delivered 1,968 homes that quarter, versus 2,387 a year earlier. The average sales price of those homes dropped from $590,000 to $552,000 in that time. 

“These results further demonstrate our ability to deliver solid profitability in a high interest rate environment,” Mizel said in a news release announcing third quarter results — the latest available. 

MDC President and CEO David Mandarich described Sekisui in the release as “well respected with a reputation for quality, and we look forward to becoming an important part of the portfolio.”

“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,” Mandarich said. 

Mandarich and Mizel own approximately 21.2% of MDC. Mandarich is the fourth highest-paid CEO based in Colorado, according to the Denver Business Journal, earning $15.68 million in total compensation in 2022.