Fitch assigns Toll Brothers notes BBB-

Fitch Ratings said it has assigned a BBB- rating to Toll Brothers, Inc.'s $400 million of 8.91% senior notes due Oct. 15, 2017.

The outlook is stable.

According to Fitch, the notes will be issued by Toll's wholly owned subsidiary, Toll Brothers Finance Corp., and will be guaranteed on a senior basis by Toll and certain of its subsidiaries that guarantee its current bank credit facilities and its senior notes.

The issue will be ranked on a pari passu basis with other senior unsecured debt, including the company's $1.56 billion unsecured revolving credit facility, the agency added, noting that proceeds from the new debt issue will be used for general corporate purposes, which may include the repayment or repurchase of certain of Toll's outstanding indebtedness.

The stable outlook reflects Toll's well-entrenched market position as the pre-eminent builder of luxury homes, the successful execution of its operating model that continues to produce one of the best margins within the industry and relatively stable debt-protection measures despite the expectation of further deterioration in housing in 2009, the agency added.

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