William Lyon Homes sets talk for $300 million two-part notes offering

By Paul A. Harris

Portland, Ore., July 31 – William Lyon Homes Inc. set price talk for its $300 million two-part notes offering (B3/B-), market sources said on Thursday.

A $250 million tranche of new eight-year senior notes, which come with two years of call protection, is talked to yield 6¾% to 7%. The issuing entity will be William Lyon Homes Escrow Subsidiary, which will be merged with and into California Lyon upon completion of the Polygon Northwest Homes (Polygon) acquisition.

William Lyon Homes Inc.’s $50 million add-on to its 5¾% senior notes due April 15, 2019 is talked at 99 to par. Those notes become callable on April 15, 2016 at 104.313. The original $150 million issue priced at par on March 26, 2014.

The deal was expected to price on Thursday, however no terms were available at press time, according to a market source.

J.P. Morgan Securities LLC, Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC are leading the Rule 144A and Regulation S deal.

The Newport Beach, Calif.-based homebuilder plans to use the proceeds to finance a portion of the Polygon acquisition.

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