Standard Pacific gets loan waiver

Shares of Standard Pacific Corp., the Irvine builder that has lost more than three-quarters of its value in the last year, rose 8% after getting a waiver from lenders to avoid a default.

Banks extended loan terms until March 30, Standard Pacific said in a regulatory filing Tuesday. The company said Monday that it cut debt and inventory in the fourth quarter and fiscal year.

“Standard Pacific is taking the right steps to work through difficult market conditions,” wrote Daniel Oppenheim, an analyst with Banc of America Securities, in a note to investors.

Standard Pacific said it wasn’t in compliance with a covenant contained in its $900- million revolving credit facility and $325 million in term loans, according to the Securities and Exchange Commission filing. The company had debt of $1.95 billion as of Dec. 31, down from $2.2 billion at the end of 2006.

Without the loan waiver, Standard Pacific may have been forced to repay the bank debt, said Matthew Wilcox, a bond analyst at KDP Investment Advisors Inc. in Montpelier, Vt. In a “worst case” scenario, it could have been forced into bankruptcy, he said.

“They generated a lot of cash, they reduced their obligations on their joint ventures and they’re expecting a sizable tax refund here in February,” Wilcox said.

Standard Pacific shares rose 36 cents to $4.96. Earlier, the shares touched $5.55.

The housing market remains challenging and it’s “hard to predict” a recovery, Standard Pacific Chief Executive Stephen Scarborough said Tuesday. The company has been hampered because it gets most of its revenue from California, where existing home sales fell 33% in December.

“In many of our markets we’ve seen considerable erosion of pricing, particularly in the California, Arizona and Florida markets,” Scarborough said. “In many markets, we’ve gone back to 2004 pricing.”

The company reduced debt by $251.1 million in the fourth quarter, Standard Pacific said Monday in an earnings statement. It owned 35,000 lots as of the end of last year, 43% fewer than at the end of 2006.

Its net loss widened to $440.9 million, or $6.80 a share, in the three months ended Dec. 31 from $98.4 million, or $1.53, a year earlier. The loss per share was more than six times the average of analysts’ estimates. Revenue fell 22% to $933.6 million.