Moody’s gives UCP CFR, notes B3

Moody's Investors Service said it assigned a B3 corporate family rating, B3-PD probability of default rating and an SGL-3 liquidity rating to UCP, Inc.

In the same action, the agency assigned a B3 rating to the proposed new $200 million of senior unsecured notes due 2021 of UCP, LLC, an intermediate holding company of UCP, and of its co-issuer, UCP Finance Corp.

Proceeds will be used to refinance UCP's existing $75 million of 8˝% senior notes due 2017, to repay all of the existing project level development and construction loans outstanding, and to add to working capital.

The outlook is stable.

Moody’s said the stable outlook reflects its expectation that UCP will continue to be profitable as it ramps up, and modestly levers up, to take advantage of growth opportunities.

UCP's B3 corporate family rating acknowledges the company's small size and scale within the homebuilding industry, its limited time in its current configuration as both a homebuilder and land developer, its thin net worth position, its California concentration and its uneven bottom line profitability record of recent years, the agency added.

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