Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to three classes of notes issued by Oxford Finance Funding 2020-1 LLC.
Oxford Finance Funding 2020-1 LLC (the “Issuer” or “Oxford 2020-1”) will issue the Class A‑1 Revolving Notes (the “Class A‑1 Notes” or the “Variable Funding Notes”), the Class A-2 Term Notes (the “Class A‑2 Notes” and, together with the Class A-1 Notes, the “Class A Notes”) and the Class B Term Notes (the “Class B Notes” and, together with the Class A Notes, the “Notes”). The Notes expect to receive payments from an initial pool of senior secured loans made to life sciences companies (the “Life Sciences Loans”) and healthcare services companies (the “Healthcare Services Loans” and, together with the Life Sciences Loans, the “Initial Loans”) and secured by certain assets of those companies.
The Initial Loans were originated by Oxford Finance LLC (“Originator”) who will also act as servicer (the “Servicer”) for Oxford 2020-1. This is the sixth term securitization of assets managed by Oxford Finance LLC (“Oxford” or the “Company”), and the fourth rated by KBRA. KBRA notes that the Company will be retaining the equity in Oxford 2020-1 as they did in the prior three securitizations.
Oxford, whose original predecessor was founded in 1987, is a specialty financial services firm that originates, underwrites, manages and finances senior secured loans provided exclusively to life sciences and healthcare services companies.
As of January 11, 2020, the composition of the statistical loans (the “Statistical Pool”) will consist of 56 loans to 49 obligors with an aggregate outstanding loan balance of approximately $447.2 million (“Statistical Pool Balance”). The exposures to the Life Sciences Loans and Healthcare Services Loans will be approximately 55.3% and 44.7% of the Statistical Pool Balance, respectively. The loans consist primarily of senior term loans generally secured by substantially all assets of the obligor; provided, that certain Life Sciences Loans may not have a lien on intellectual property, but may have the benefit of a negative pledge over such intellectual property.
KBRA analyzed the transaction using KBRA’s Global General Rating Methodology for Asset-Backed Securities, and the Global Structured Finance Counterparty Methodology published on November 28, 2017 and August 8, 2018, respectively.
Rated Notes | |||||
Class | Initial
| Note Rate | Cumulative
| Legal Final
| Preliminary
|
A-1 | $30,000,000 | CP + TBD | 72.5% | February 2028 | A (sf) |
A-2 | $294,210,000 | Fixed Rate- TBD | 72.5% | February 2028 | A (sf) |
B | $44,720,000 | Fixed Rate- TBD | 82.5% | February 2028 | BBB (sf) |
Liquidity Facility | $11,067,900 | Floating 3m LIBOR | N/A | February 2028 | A (sf) |
Total | $368,930,000 | ||||
To access ratings, reports and disclosures, click here.
Related Publications: (available at www.kbra.com)
- Oxford Finance Funding 2020-1 Pre-Sale Report
- Global General Rating Methodology for Asset-Backed Securities
- Global Structured Finance Counterparty Methodology
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About KBRA and KBRA Europe
KBRA is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. 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, and is a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.
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