New Issue: KB Home prices upsized $390 million 4% 10-year bullet notes at par

By Paul A. Harris

Portland, Ore., May 25 – KB Home priced an upsized $390 million issue of 10-year senior bullet notes (Ba2/BB) at par to yield 4% in a Tuesday drive-by, according to market sources.

The issue size increased from $300 million.

The yield printed in the middle of yield talk in the 4% area. Initial guidance was in the low 4% area.

BofA Securities Inc. was at the left of a syndicate of bookrunners that also included Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Wells Fargo Securities LLC, BNP Paribas Securities Corp. and MUFG.

The Los Angeles-based homebuilder plans to use the proceeds plus cash on hand, as needed, to fund the tender/redemption of its 7% senior notes due 2021.

Issuer:	KB Home
Amount:	$390 million, increased from $300 million
Maturity:	June 15, 2031
Securities:	Senior notes
Bookrunners:	BofA Securities, Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Wells Fargo Securities LLC, BNP Paribas Securities Corp. and MUFG
Co-managers:	Fifth Third Securities Inc., TCB Capital Markets, BMO Capital Markets Corp., CIBC World Markets Corp., Regions Securities LLC and Zions Direct Inc.
Coupon:	4%
Price:	Par
Yield:	4%
Spread:	244 bps
Call protection:	Non-callable
Trade date:	May 25
Settlement date:	June 9
Ratings:	Moody's: Ba2
	S&P: BB
Distribution:	SEC registered
Price talk:	4% area
Marketing:	Drive-by

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