DOW JONES NEWSWIRES
Hovnanian Enterprises Inc. (HOV) detailed plans to offer $50
million of the home builder's Class A shares, three million
tangible equity units and senior unsecured notes, with plans to use
the proceeds to purchase earlier notes.
Shares of Hovnanian, which builds homes in 18 states, slid 2.9%
to $4.29 in after-hours trading, as the amount of shares will
increase after the offering. Hovnanian, which is the latest in a
string of companies looking to take advantage of record-low
interest rates by refinancing debt, has about 78.8 million shares
outstanding.
Hovnanian said the equity units will each comprise of a prepaid
stock purchase contract issued by the company and a senior
subordinated note due in 2014. Hovnanian also intends to offer $150
million of senior unsecured notes due in 2015.
The company intends to use the proceeds to fund the purchase of
Hovnanian's notes due in 2012 and 2013. The remainder of the
proceeds will be used for general corporate purposes.
In December, Hovnanian reported its fiscal fourth-quarter loss
narrowed on lower land-related charges than a year earlier, though
revenue and contracts slid.
-By John Kell, Dow Jones Newswires; 212-416-2480;
john.kell@dowjones.com