Fitch rates Meritage notes BB-

Fitch Ratings said it assigned a BB- with recovery rating of RR3 to Meritage Homes Corp.'s proposed offering of $100 million of senior unsecured notes.

The offering is an add-on to its existing 7.15% senior unsecured notes due 2020.

The issuance will be equal in right of payment with all other senior unsecured debt, Fitch said.

The proceeds will be used for general corporate purposes, including the acquisition and development of land and home construction.

The outlook is positive.

The company also has a long-term issuer default rating of B+ and senior unsecured debt rating of BB- with recovery rating of RR3.

The ratings are influenced by the company's execution of its business model, conservative land policies, geographic diversity and healthy liquidity position, Fitch said.

The positive outlook considers an expectation of further moderate improvement in the housing market in 2013 and 2014, share gains and volume outperformance relative to industry trends and much better profitability and sharply improved credit metrics, the agency said.

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