Moody's: Meritage convertibles B1

Moody's Investors Service said it assigned a B1 rating to Meritage Homes Corp.'s proposed $100 million convertible senior unsecured notes due 2032, and a provisional B1 rating to senior unsecured shelf.

In the same rating action, Moody's affirmed the company's B1 corporate family and probability of default ratings, B1 rating on the existing senior unsecured notes due 2020 and 2022, and SGL-2 speculative grade liquidity rating.

The outlook is stable.

The proceeds from the note offering are expected to be used for general corporate purposes. In July 2012, the company issued approximately $87 million of common stock.

As a result of the increase in both debt and equity, the company's adjusted homebuilding debt to capitalization ratio is expected to remain at approximately 56% at June 30, the agency said.

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