Meritage Homes accepts tenders for $247 million 7% notes, 6¼% notes

By Devika Patel

Knoxville, Tenn., April 20 - Meritage Homes Corp. said about $247 million of notes was tendered by the Monday early tender date as part of the company's tender offer for all of its $130 million of 7% senior notes due May 1, 2014 and $65 million of its $350 million of 6¼% senior notes due 2015 in a modified Dutch auction.

Holders of $107.1 million of the 7% notes and $139.9 million of the 6¼% notes tendered their securities by the early deadline.

For each $1,000 principal amount, the purchase price was $1,025 for the 7% notes and the acceptable bid range for the 6¼% notes was $960 to $1,000. These prices include an early tender premium of $20.00 for each note tendered by the Monday deadline.

Holders will also receive accrued interest up to but excluding the settlement date.

Under the modified Dutch auction procedure, Meritage will accept tendered notes in the order of the lowest to the highest tender prices specified by the tendering holders (in increments of $1.25) and will select the single lowest price that will allow it to purchase an amount of notes equal to the tender cap or, if less than the tender cap are tendered, all notes tendered.

If the amount of notes tendered at or below the selected purchase price exceeds the tender cap, Meritage will first accept for purchase all notes tendered at prices below the purchase price and then notes tendered at the purchase price on a prorated basis.

The offers will expire at midnight ET on May 3.

Citigroup Global Markets Inc. (800 558-3745 or 212 723-6106, Attn. liability management group) and J.P. Morgan Securities Inc. are the dealer managers. Global Bondholder Services Corp. (866 804-2200 or 212 430-3774) is the depositary and information agent.

Meritage is a homebuilder based in Scottsdale, Ariz.

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