Fitch rates KB Home convertibles B+/RR4

Fitch Ratings said it assigned a B+/RR4 rating to KB Home's proposed offering of $150 million convertible senior unsecured notes due 2019.

The new issue will be equal in right of payment with all other senior unsecured debt.

Concurrent with the notes offering, KB Home also announced the public offering of $100 million of its common stock. The company intends to use the proceeds of the notes issuance and the common stock offering for general corporate purposes, including land acquisitions and development.

The outlook is stable.

Fitch said the ratings for KB Home are based on the company's geographic diversity, customer and product focus, conservative building practices and effective usage of return on invested capital criteria as a key element of its operating model.

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