Cavco Industries Inc., a builder of manufactured housing and park model RVs, announced it has signed a letter of intent and has reached an understanding on the principal terms to acquire Lexington Homes Inc.

According to a press release, Lexington provides affordable manufactured housing from its manufacturing plant in Lexington, Miss., to its retail distributors in the Southeastern United States.

The purchase of Lexington is expected to improve Cavco’s ability to participate in the growing Southeastern housing market, as well as better serve the needs of Lexington customers.

The purchase price, which will be paid in cash at closing and funded with Cavco’s internal capital, was not disclosed. The transaction is subject to the satisfaction of customary closing conditions.