Moody's rates William Lyon Homes notes B3

Moody's Investors Service said it assigned a B3 rating to the new issue of $150 million of 7.5% senior unsecured notes due Feb. 15, 2014 of William Lyon Homes Inc. (a California operating company) and confirmed the B2 senior implied rating and B3 senior unsecured issuer rating of William Lyon Homes (the Delaware parent company).

The outlook is stable.

Moody's said the ratings reflect William Lyon Homes' heavy geographic concentration in California, the rising number of top 20 national homebuilders in its markets, and the moderately heavy debt leverage employed.

At the same time, the ratings acknowledge the shift in the company's capital structure away from one that was top-heavy with secured debt, the substantial growth in the company's equity base since 1997, its strong shares in key California markets, and its healthy and growing profitability.

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