Lennar Corporation, is in negotiations with its bank group seeking to renew its 364-day, $300 million revolving credit facility. Lennar has the option to term-out the facility through its syndicate if the revolver is not renewed, said Waynewright Malcolm, treasurer. Lennar must make a decision by the end of April on its options for the facility. The revolver was issued along with a five-year, $700 million facility through a syndicate of banks led by BANK ONE.
The discussions with the bank group come as the Miami, Fla.-based homebuilder is scrutinizing the bond market and would look to issue debt if an opportunity presents itself. The company has no current plans to issue additional debt but if a window did open up it would consider tapping the market, Malcolm said. He could not say how large an offering would be or what conditions would trigger a deal. "The company is very well positioned on the balance sheet," he explained. "Any transaction--if done--would be for general corporate purposes."
Lennar is in constant talks with investment banks, Malcolm said. The company has no preset parameters for pricing a deal and is open to and listening to ideas. Deutsche Banc Alex. Brown is its traditional bank but it has used other firms to lead transactions, including Banc of America Securities, Bank One Capital Markets and Salomon Smith Barney. "We would be open to using another bank," he said. Lennar fields offers from any bank that comes to it and would use a firm that approached it with a good idea, he explained.