articles Ratings /ratings/en/research/articles/200207-leveraged-finance-issuer-spotlight-top-250-clo-obligor-duff-phelps-holdings-corp-on-creditwatch-negativ-11344185 content esgSubNav
In This List
COMMENTS

Leveraged Finance: Issuer Spotlight: Top-250 CLO Obligor (Duff & Phelps Holdings Corp.) On CreditWatch Negative

COMMENTS

Instant Insights: Key Takeaways From Our Research

COMMENTS

Tariff Effects On European Structured Finance Are Limited

COMMENTS

U.S. Oil And Gas: Oil Price Drops Could Bore Into Producer Spending

COMMENTS

Cracks In Consumer Confidence Amid Tariffs And Inflation Could Lead To Tighter U.S. Leisure Spending


Leveraged Finance: Issuer Spotlight: Top-250 CLO Obligor (Duff & Phelps Holdings Corp.) On CreditWatch Negative

What's New:

On Feb. 6, 2020, S&P Global Ratings placed all of its ratings on Duff & Phelps Holdings Corp., including the 'B' issuer credit rating, on CreditWatch with negative implications.

Our rating actions reflected the following:

  • U.S.-based business consulting firm Duff & Phelps Holdings Corp. has announced that it will be acquired by a group of investors, led by its financial sponsors Stone Point Capital and Further Global, for $4.2 billion. The company did not disclose how it intends to fund the transaction, though its leverage is already elevated above 6.5x following its acquisitions over the past two years.
  • In our view, a deal of this size could increase the company's leverage because we expect that its funding will include incremental debt. We could lower our rating to 'B-' if Duff & Phelps funds the transaction with incremental debt such that the company is unable to reduce its leverage to our 6.5x threshold for the current rating in the first half of 2020.
  • We expect to resolve our CreditWatch upon the company's announcement of its proposed capital structure.

Duff & Phelps is a global valuation and corporate finance advisor. The firm offers advisory in valuation, alternative assets, compliance and regulatory consulting, disputes and investigations, legal management consulting, mergers and acquisitions, real estate, restructuring, tax, and transaction opinions.

BSL CLO Exposure Ranking:

We ranked Duff & Phelps Holdings Corp. 115 among the top 250 obligors for U.S. broadly syndicated collateralized loan obligations (BSL CLOs) in the fourth quarter.

Recent market price:  $100.625 first-lien term loan (Source: Bloomberg, Feb. 7, 2020)

CLO exposures and insights:
  • 36 out of 105 CLO managers with S&P Global Ratings-rated CLOs have exposure to Duff & Phelps Holdings Corp.
  • Of these 36 CLO managers, the average manager exposure to Duff & Phelps (the percentage of assets under management across S&P Global Ratings-rated CLOs per manager) is 0.34%, with a high of 0.79% and a low of 0.01%.

Manager Number of S&P-rated CLOs with exposure to Duff & Phelps % of AUM of S&P-rated CLOs
Aegon USA Investment Management 8 0.55%
AIG Asset Management 2 0.37%
American Money Management 5 0.20%
Arrowpoint Asset Management 1 0.06%
Barings 7 0.35%
BlackRock Financial Management 2 0.23%
BlueMountain Capital Management 20 0.42%
Carlyle Investment Management 6 0.14%
CIFC Asset Management 9 0.45%
CVC Credit Partners 10 0.41%
Denali Capital 1 0.45%
Eaton Vance Management 2 0.24%
Five Arrows Managers 1 0.19%
GC Investment Management 2 0.02%
GSO/Blackstone Debt Funds Management 18 0.24%
Highbridge Principal Strategies 12 0.22%
Investcorp 1 0.31%
Kingsland Capital Management 1 0.04%
Kramer Van Kirk Credit Strategies 1 0.68%
LCM Asset Management 14 0.42%
Mariner Investment Group 7 0.60%
MidOcean Credit Fund Management 3 0.39%
Neuberger Berman 17 0.64%
Oak Hill Advisors 7 0.01%
Och-Ziff Loan Management 5 0.60%
Octagon Credit Investors 17 0.17%
Onex Credit Partners 12 0.28%
Palmer Square Capital Management 6 0.58%
PineBridge Investments 5 0.37%
Romark CLO Advisors 1 0.35%
TPG Capital 2 0.44%
Trimaran Advisors 4 0.79%
Trinitas Capital Management 2 0.14%
Voya Investment Management 18 0.34%
West Gate Horizons Advisors 1 0.17%
Whitebox Capital Management LLC 1 0.50%
CLO--Collateralized loan obligation. AUM--Assets under management. Source: S&P Global Ratings.

Related Research

  • Duff & Phelps Holdings Corp. Ratings Placed On CreditWatch Negative On Planned Acquisition By Financial Sponors, Feb. 6, 2020
  • The Most Widely Referenced Corporate Obligors In Rated U.S. BSL CLOs: Fourth-Quarter 2019, Jan. 10, 2020

This report does not constitute a rating action.

Primary Credit Analysts:Robert E Schulz, CFA, New York (1) 212-438-7808;
robert.schulz@spglobal.com
Daniel Hu, FRM, New York (1) 212-438-2206;
daniel.hu@spglobal.com
Secondary Contact:Elton Cerda, New York (1) 212-438-9540;
elton.cerda@spglobal.com
Contributors:Minni Zhang, New York;
minni.zhang@spglobal.com
Zoya Alam, New York;
zoya.alam@spglobal.com

No content (including ratings, credit-related analyses and data, valuations, model, software or other application or output therefrom) or any part thereof (Content) may be modified, reverse engineered, reproduced or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of Standard & Poor’s Financial Services LLC or its affiliates (collectively, S&P). The Content shall not be used for any unlawful or unauthorized purposes. S&P and any third-party providers, as well as their directors, officers, shareholders, employees or agents (collectively S&P Parties) do not guarantee the accuracy, completeness, timeliness or availability of the Content. S&P Parties are not responsible for any errors or omissions (negligent or otherwise), regardless of the cause, for the results obtained from the use of the Content, or for the security or maintenance of any data input by the user. The Content is provided on an “as is” basis. S&P PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE, FREEDOM FROM BUGS, SOFTWARE ERRORS OR DEFECTS, THAT THE CONTENT’S FUNCTIONING WILL BE UNINTERRUPTED OR THAT THE CONTENT WILL OPERATE WITH ANY SOFTWARE OR HARDWARE CONFIGURATION. In no event shall S&P Parties be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs or losses caused by negligence) in connection with any use of the Content even if advised of the possibility of such damages.

Credit-related and other analyses, including ratings, and statements in the Content are statements of opinion as of the date they are expressed and not statements of fact. S&P’s opinions, analyses and rating acknowledgment decisions (described below) are not recommendations to purchase, hold, or sell any securities or to make any investment decisions, and do not address the suitability of any security. S&P assumes no obligation to update the Content following publication in any form or format. The Content should not be relied on and is not a substitute for the skill, judgment and experience of the user, its management, employees, advisors and/or clients when making investment and other business decisions. S&P does not act as a fiduciary or an investment advisor except where registered as such. While S&P has obtained information from sources it believes to be reliable, S&P does not perform an audit and undertakes no duty of due diligence or independent verification of any information it receives. Rating-related publications may be published for a variety of reasons that are not necessarily dependent on action by rating committees, including, but not limited to, the publication of a periodic update on a credit rating and related analyses.

To the extent that regulatory authorities allow a rating agency to acknowledge in one jurisdiction a rating issued in another jurisdiction for certain regulatory purposes, S&P reserves the right to assign, withdraw or suspend such acknowledgment at any time and in its sole discretion. S&P Parties disclaim any duty whatsoever arising out of the assignment, withdrawal or suspension of an acknowledgment as well as any liability for any damage alleged to have been suffered on account thereof.

S&P keeps certain activities of its business units separate from each other in order to preserve the independence and objectivity of their respective activities. As a result, certain business units of S&P may have information that is not available to other S&P business units. S&P has established policies and procedures to maintain the confidentiality of certain non-public information received in connection with each analytical process.

S&P may receive compensation for its ratings and certain analyses, normally from issuers or underwriters of securities or from obligors. S&P reserves the right to disseminate its opinions and analyses. S&P's public ratings and analyses are made available on its Web sites, www.standardandpoors.com (free of charge), and www.ratingsdirect.com and www.globalcreditportal.com (subscription), and may be distributed through other means, including via S&P publications and third-party redistributors. Additional information about our ratings fees is available at www.standardandpoors.com/usratingsfees.

Any Passwords/user IDs issued by S&P to users are single user-dedicated and may ONLY be used by the individual to whom they have been assigned. No sharing of passwords/user IDs and no simultaneous access via the same password/user ID is permitted. To reprint, translate, or use the data or information other than as provided herein, contact S&P Global Ratings, Client Services, 55 Water Street, New York, NY 10041; (1) 212-438-7280 or by e-mail to: research_request@spglobal.com.


 

Create a free account to unlock the article.

Gain access to exclusive research, events and more.

Already have an account?    Sign in