KB Home driving by with $400 million notes in two bullet tranches

By Paul A. Harris

Portland, Ore., Feb. 5 – KB Home (B1/BB) plans to price $400 million of senior bullet notes in a quick-to-market Tuesday trade, according to a market source.

The public offering features $300 million of new eight-year bullet notes with initial guidance in the 7¼% area.

In addition, the Los Angeles-based homebuilder plans to place a $100 million add-on to its 7 5/8% senior bullet notes due May 15, 2023. Initial guidance on the tap is 104.5. The original $250 million issue priced at par in February 2015. The add-on notes will become fungible with the original notes.

Deutsche Bank Securities Inc., BofA Merrill Lynch, Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC are the joint bookrunners.

BNP Paribas Securities Corp., MUFG, Wells Fargo Securities LLC and TCB Capital Markets are the co-managers.

Proceeds will be used to refinance the KB Home 4¾% senior notes due May 2019.

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