S&P may cut Tousa

Standard & Poor's said it will lower its CC corporate credit rating assigned to Tousa Inc. if the homebuilder fails to make its scheduled Jan. 1 interest payments on its 10 3/8% senior subordinated notes due 2012 and on its 9% senior notes due 2010.

If interest payments are not made, the agency said it will lower the rating on those notes to D from C.

S&P added that Tousa recently announced that it had amended its first-lien term loan and revolving credit agreements, stating that the amendments include a requirement that Tousa operate under a cash flow budget that does not provide for payments on its long-term indebtedness, including the note issues referenced above.

Furthermore, a payment default on those notes could trigger acceleration of additional long-term indebtedness if Tousa does not make the delinquent interest payments within a 30-day grace period, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.