New Issue: Hovnanian prices $150 million five-year notes at par to yield 7%

By Paul A. Harris

Portland, Ore., Jan. 7 - K. Hovnanian Enterprises, Inc. priced a $150 million issue of five-year senior notes (Caa1/CCC/CCC) at par to yield 7% on Tuesday, according to an informed source.

The yield printed on top of yield talk.

Credit Suisse Securities (USA) LLC and J.P. Morgan Securities LLC were the joint bookrunners.

The Red Bank, N.J.-based homebuilder plans to use the proceeds to refinance its 6 5/8% senior notes due 2015 and for general corporate purposes.

Issuer:	K. Hovnanian Enterprises, Inc.
Amount:	$150 million
Maturity:	Jan. 15, 2019
Securities:	Senior notes
Bookrunners:	Credit Suisse Securities (USA) LLC, JP Morgan Securities LLC
Coupon:	7%
Price:	Par
Yield:	7%
Spread:	529 bps
First call:	July 15, 2016 at 103.5
Equity clawback:	35% at 107 until July 15, 2016
Change-of-control put:	101%
Trade date:	Jan. 7
Settlement date:	Jan. 10
Ratings:	Moody's: Caa1
	Standard & Poor's: CCC
	Fitch: CCC
Distribution:	Rule 144A for life and Regulation S
Price talk:	7% area
Marketing:	Brief roadshow

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