New Issue: New Home sells upsized $75 million tap of 7¼% notes due 2022 at 102.75

By Paul A. Harris

Portland, Ore., May 1 – New Home Co., Inc. priced an upsized $75 million tack-on to its 7¼% senior notes due April 1, 2022 (B3/B-) at 102.75 on Monday, according to market sources.

The issue size was increased from $50 million.

The reoffer priced at the rich end of the 102.5 to 102.75 price talk. Initial guidance was in the 102.5 area.

Credit Suisse Securities (USA) LLC was the lead left bookrunner. Citigroup Global Markets Inc. and J.P. Morgan Securities LLC are the joint bookrunners.

The Aliso Viejo, Calif.-based homebuilder plans to use the proceeds, including those resulting from the $25 million upsizing of the deal, for working capital, land acquisitions and for general corporate purposes.

Issuer:	New Home Co., Inc.
Amount:	$75 million, increased from $50 million
Maturity:	April 1, 2022
Security description:	Tack-on to 7¼% senior notes due April 1, 2022
Lead left bookrunner:	Credit Suisse Securities (USA) LLC
Joint bookrunners:	Citigroup Global Markets Inc., J.P. Morgan Securities LLC
Coupon:	7¼%
Price:	102.75
Yield to worst:	6.438%
Spread:	474 bps
First call:	Oct. 1, 2019 at 103.625
Equity clawback:	35% at 107.25 until Oct. 1, 2019
Trade date:	May 1
Settlement date:	May 4 with accrued interest
Ratings:	Moody's: B3
	S&P: B-
Distribution:	Rule 144A and Regulation S with registration rights
Price talk:	102.5 to 102.75
Marketing:	Quick to market
Original issue:	$250 million priced at 98.961 to yield 7½% on March 10, 2017
Fungibility:	Tack-on notes will immediately become fungible with original notes
Total issue size:	$325 million

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