S&P applies B- to William Lyon notes

S&P said it assigned its B- issue-level rating and 3 recovery rating to William Lyon Homes Inc.'s proposed $450 million senior unsecured notes due 2025.

The 3 recovery rating reflects an expectation for meaningful (50%-70%; higher end of range) recovery in the event of default.

All other ratings are unchanged.

S&P said it expects William Lyon to use the proceeds from the offering to retire its existing $425 million senior notes due 2020, which bear an interest rate of 8½%.

While the corporate credit rating is unchanged, the agency said it views the transaction as positive for the company's credit profile due to the reduction of annual cash interest of approximately $10 million per year.

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