Presley, Lenders Finalize Plans for Restructuring : Home building: Creditors would get a 70% stake in the Newport Beach company under the agreement, which still must be approved by shareholders.

NEWPORT BEACH — Presley Cos., the Newport Beach home builder, said Thursday it has finalized an agreement with its lenders to restructure a $340-million revolving line of credit, giving lenders a 70% stake in the company.

Under the previously announced debt-for-equity swap plan, lenders will convert $95 million of debt into a newly created series of stock, which will become convertible into 43.2 million common shares. Presley has about 18.5 million shares outstanding.

Since reaching a 52-week high of $4.12 on Jan. 20, just days before details of the restructuring were released, Presley’s stock has since dropped 36%. In New York Stock Exchange trading Thursday, it closed at $2.625, down 50 cents.

Presley, which builds planned communities in California, Arizona and New Mexico, still needs shareholder approval to complete its restructuring. If approved, the restructuring will add two seats to the company’s seven-member board of directors; three of those nine seats will be earmarked for lenders.

Presley’s lenders include Foothill Capital Corp., a lender and money manager in Los Angeles; and Pearl Street L.P. in New York. Earlier this year, the two companies became Presley investors by buying Bank of America’s stake in the credit line.

The remaining $240 million of debt will be converted into a new three-year, $95-million credit line and a five-year, $150-million loan. The lenders will provide another $20-million credit line to purchase and improve land, Presley said.

The company has become a victim of its own aggressive land acquisition policy in the late 1980s, when it purchased most of its properties with loans.