KBRA Assigns Preliminary Ratings to Golub Capital Partners ABS Funding 2024-2
19 Julio 2024 - 10:06AM
Business Wire
KBRA assigns preliminary ratings to four classes of debt issued
by Golub Capital Partners ABS Funding 2024-2 ("GCPAF 2024-2"), a
securitization backed by a portfolio of recurring revenue and
middle market corporate loans.
GCPAF 2024-2 is a loan securitization managed by GC Investment
Management LLC (“GCIM” or the “Collateral Manager”), an investment
adviser and affiliate of GC Advisors LLC (collectively, with these
affiliates and other funds managed by them and their affiliates
“Golub Capital”). The securitization consists of $227.5 million
Class A notes, $31.5 million Class B notes (collectively the
“Notes”), and $91.0 million Subordinated Notes, which expect to
receive payments from the portfolio of recurring revenue loans
(“RRLs”) and middle market loans (“MMLs”). Proceeds from the
issuance of the notes will be used to purchase assets
(approximately $350.0 million).
This is Golub Capital’s tenth securitization collateralized
predominately by RRL and MML. The RRL strategy focuses on
first-lien senior loans to technology and software companies that
have a minimum level of recurring revenue and low loan-to-value
(LTV) ratios. Golub Capital views the RRLs strategy as a complement
to its middle market business and an extension of core competencies
in the technology and software industries.
The rated notes benefit from internal credit enhancement through
subordination, borrowing base, and excess spread. The Class A and B
Notes have a 65.0% and 74.0% advance rate respectively and are
expected to receive timely interest and ultimate principal under
KBRA’s rating scenarios. KBRA determined a credit assessment for
each asset in the initial portfolio. At closing, the portfolio is
expected to have a K-WARF of 3492, which equates to a weighted
average assessment between B- and CCC+. The overall credit quality
of RRLs, which account for 69.4% of the portfolio, is generally
lower than that of traditional MMLs.
Kroll Bond Rating Agency’s (KBRA) ratings on the Class A-1,
Class A-2 (collectively, “Class A”), Class B-1, and Class B-2 Notes
(collectively, “Class B”) consider the timely payment of interest
and ultimate payment of principal by the applicable stated maturity
date. KBRA’s analysis as presented herein assumes the Class B Notes
are floating. KBRA’s analysis also considered fixed-rate Class B
Notes.
To access rating and relevant documents, click here.
Click here to view the report.
Methodologies
- Structured Credit: Structured Credit Global Rating
Methodology
- Structured Finance: Global Structured Finance Counterparty
Methodology
- ESG Global Rating Methodology
Disclosures
Further information on key credit considerations, sensitivity
analyses that consider what factors can affect these credit ratings
and how they could lead to an upgrade or a downgrade, and ESG
factors (where they are a key driver behind the change to the
credit rating or rating outlook) can be found in the full rating
report referenced above.
A description of all substantially material sources that were
used to prepare the credit rating and information on the
methodology(ies) (inclusive of any material models and sensitivity
analyses of the relevant key rating assumptions, as applicable)
used in determining the credit rating is available in the
Information Disclosure Form(s) located here.
Information on the meaning of each rating category can be
located here.
Further disclosures relating to this rating action are available
in the Information Disclosure Form(s) referenced above. Additional
information regarding KBRA policies, methodologies, rating scales
and disclosures are available at www.kbra.com.
About KBRA
Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit
rating agency registered with the U.S. Securities and Exchange
Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is
registered as a CRA with the European Securities and Markets
Authority. Kroll Bond Rating Agency UK Limited is registered as a
CRA with the UK Financial Conduct Authority. In addition, KBRA is
designated as a designated rating organization by the Ontario
Securities Commission for issuers of asset-backed securities to
file a short form prospectus or shelf prospectus. KBRA is also
recognized by the National Association of Insurance Commissioners
as a Credit Rating Provider.
Doc ID: 1005161
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240719579733/en/
Analytical Contacts
Jerry Jurcisin, Associate Director (Lead Analyst) +1
646-731-2457 jerry.jurcisin@kbra.com
Delia Lawver, Associate +1 646-731-2433
delia.lawver@kbra.com
Peter Connolly, Senior Director +1 646-731-1283
peter.connolly@kbra.com
Eric Hudson, Senior Managing Director, Co-Head of Global
Structured Credit (Rating Committee Chair) +1 646-731-3320
eric.hudson@kbra.com
Business Development Contact
Jason Lilien, Senior Managing Director +1 646-731-2442
jason.lilien@kbra.com