By Paul A. Harris
Portland, Ore., Feb. 5 – KB Home priced $400 million of senior bullet notes (B1/BB-) in two tranches in a quick-to-market Tuesday trade, according to market sources.
The deal featured $300 million of new eight-year notes, which priced at par to yield 6 7/8%. The yield printed at the tight end of yield talk in the 7% area and tighter than initial guidance in the 7¼% area.
In addition, the Los Angeles-based homebuilder priced a $100 million add-on to its 7 5/8% senior bullet notes due May 15, 2023 at 105.25 to yield 6.03%. The price came at the rich end of the 105 to 105.25 price talk. Initial guidance was 104.5.
Deutsche Bank Securities Inc., BofA Merrill Lynch, Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC are the joint bookrunners.
Proceeds will be used to refinance the KB Home 4¾% senior notes due May 2019.
| Issuer: | KB Home
|
| Amount: | $400 million
|
| Bookrunners: | Deutsche Bank Securities Inc., BofA Merrill Lynch, Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC
|
| Co-managers: | BNP Paribas Securities Corp., MUFG, Wells Fargo Securities LLC, TCB Capital Markets
|
| Call protection: | Non-callable
|
| Trade date: | Feb. 5
|
| Settlement date: | Feb. 20
|
| Ratings: | Moody's: B1
|
| S&P: BB-
|
| Distribution: | SEC registered
|
| Marketing: | Quick to market
|
|
|
| New notes
|
| Amount; | $300 million
|
| Maturity: | June 15, 2027
|
| Securities: | Senior notes
|
| Coupon: | 6 7/8%
|
| Price: | Par
|
| Yield: | 6 7/8%
|
| Spread: | 422 bps
|
| Price talk: | 7% area
|
|
|
| Add-on notes
|
| Amount: | $100 million
|
| Maturity: | May 15, 2023
|
| Security description: | Add-on to 7 5/8% senior notes due May 15, 2023
|
| Coupon: | 7 5/8%
|
| Price: | 105.25
|
| Yield to worst: | 6.03%
|
| Spread: | 367 bps
|
| Price talk: | 105 to 105.25
|
| Original issue: | $250 million priced at par in February 2015
|
| Fungibility: | Add-on notes will become fungible with the original notes
|
| Total issue size: | $350 million
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
