S&P rates Hovnanian loan B, notes CCC, CCC-

S&P said it assigned a B rating to K. Hovnanian Enterprises, Inc.'s proposed $75 million first-lien super priority term loan due 2019.

The rating on the loan is two notches above the company’s CCC+ corporate credit rating.

A recovery rating of 1 was assigned to the notes, indicating 90% to 100% expected default recovery.

S&P also said it assigned a CCC rating to Hovnanian's proposed $75 million 9˝% first-lien notes. The recovery rating is 5, indicating 10% to 30% expected default recovery.

The agency also said it assigned a CCC- rating to Hovnanian's proposed 10% second-lien notes. The recovery rating is 6, indicating 0 to 10% expected default recovery.

S&P also said it revised the recovery rating on the company's $577 million senior secured first-lien notes due 2020 to 4 from 3, indicating 30% to 50% expected default recovery.

The proceeds will be used to refinance existing debt and extend near-term maturities, the agency said.

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