* South Edge's involuntary bankruptcy petition dismissed
* KB Home has 48.5 pct stake in South Edge
* Shrs fall as much as 6 pct
(Recasts; adds details, background, share movement)
Feb 4 (Reuters) - KB Home (KBH.N) said it may have to repay at least $180 million in loans made to a joint venture project that failed to get an involuntary bankruptcy petition dismissed -- a move that could have a material impact on its financials.
KB Home's shares fell 6 percent to $13.78 in early trading on the New York Stock Exchange before clawing back to $14.
In a regulatory filing, KB Home, said it may be asked to pay $180 million plus a significant amount for accrued and unpaid interest and attorneys' fees for loans made to South Edge LLC, in which it owns a 48.5 percent stake.
In December 2010, some of South Edge's lenders, including JPMorgan Chase Bank, Wells Fargo Bank and Credit Agricole Corporate and Investment Bank, filed a Chapter 11 involuntary bankruptcy petition against it.
The petition alleged South Edge failed to undertake certain development-related activities and repay amounts due on secured loans of about $585.0 million.
On Feb. 3, the court denied South Edge's motions to dismiss the petition, and entered an order for relief and for the appointment of a trustee.
KB Home expects that a demand will be made under a limited several guaranty that it provided to the lenders.
The company said it would contest the demand, and an unfavorable outcome would adversely affect its financial position and results of operations. (Reporting by A.Ananthalakshmi in Bangalore; Editing by Joyjeet Das)