Presley Cos. Wins Extension of Its Credit Line : Finance: Cash-strapped home builder allowed to delay payment until March, 1995, in return for higher interest, stock option.

NEWPORT BEACH —  Cash-strapped Presley Cos., one of California’s largest home builders, said late Wednesday that it has won a two-year extension on its revolving line of credit from its bankers--but may pay a stiff price.

Under the agreement, the company’s major lenders will extend the credit line to the end of March, 1995, in return for a higher interest rate and the right to buy as much as 10% of the company’s stock at $5 a share.

The stock closed unchanged Friday on the New York Stock Exchange at $3.50 a share. It has traded as high as $17.375 and as low as $1.75 since the company went public in October, 1991.

The agreement, which contains other changes in the credit line, is to become effective by the end of April.

Presley, a publicly held company that lost $10.5 million last year, said the amount of credit available was reduced to $340 million. At the end of December, Presley had borrowed $317.2 million on a $360-million credit line.

The company’s revenue last year was $237.8 million.

Presley was the victim of an aggressive land acquisition policy undone by poor timing. The company bought vacant real estate at the top of the market in the late 1980s and has seen the value of its land plummet since.

The credit line is the company’s major source of operating funds.

Presley also said that other lenders extended the due date for two months--to the end of May--on loans totaling $37.4 million for two joint ventures. During that time, the company said, it hopes to close an agreement to extend the due date for one project, Horsethief Canyon Ranch in Riverside County, to the end of March, 1995. Presley said it is discussing a longer extension with banks on the other project, Carmel Mountain Ranch in San Diego County, but has received no assurances yet.