Los Angeles-based KB Home plans to concurrently raise $125 million of common equity along with $300 million of new senior notes due in 2019 to fund inventory investments. We affirmed all our ratings on the homebuilder, including our 'B' corporate credit rating. We assigned a 'B' issue-level rating to the proposed $300 million senior notes and a '3' recovery rating, indicating our expectations for a meaningful (50% to 70%) recovery. The stable outlook reflects our view that the continuing, albeit uneven, recovery in housing and KB Home's position within some of the healthier housing markets and improving geographic and product mix should result in better profitability and key credit measures over the next two years. NEW YORK (Standard&Poor's)
