...CENTENNIAL (S&P Global Ratings) Feb. 5, 2019--S&P Global Ratings today assigned its '##-' issue-level rating and '3' recovery rating to KB Home's proposed $300 million senior unsecured notes due in 2027. The '3' recovery rating indicates our expectation of meaningful (50%-70%; rounded estimate: 65%) recovery in the event of payment default. This proposed new issuance will be used to repay $400 million senior unsecured notes due in May 2019. In addition, the company proposed $100 million in borrowings that it plans to add on to its existing senior notes due in 2023. This supplemental tranche and cash on hand will be used to pay off its $230 million in convertible notes that matured on Feb. 1, 2019. RECOVERY ANALYSIS Key Analytical Factors + We estimate a gross recovery value of about $2.15 billion, which assumes a blended 53% realization rate to book value of inventory and cash also discounted. + Although we have estimated substantial recovery prospects for KB Home's senior noteholders,...
