DBRS Assigns Rating of AA (sf) to the Loans of Cerberus Onshore Levered IV LLC

DBRS, Inc. (DBRS) assigned a rating of AA (sf) to the Class A-R Loans (the Loans) issued by Cerberus Onshore Levered IV LLC, up to the total commitment permitted under the Loans of $150,000,000.

The Loans are being issued pursuant to the Credit Agreement dated as of July 16, 2019, among Cerberus Onshore Levered IV LLC, as Borrower; Cerberus Levered IV Holdings LLC, as Servicer; the Lenders referred to therein; Natixis, New York Branch, as Administrative Agent; and U.S. Bank National Association (rated AA (high) with a Stable trend by DBRS), as Collateral Agent and Custodian.

The rating on the Loans addresses the timely payment of interest and the ultimate payment of principal on or before the Final Maturity Date (as defined in the Credit Agreement referred to above).

The Loans issued by Cerberus Onshore Levered IV LLC will be collateralized primary by a portfolio of U.S. middle-market corporate loans. Cerberus Onshore Levered IV LLC will be serviced by Cerberus Levered IV Holdings LLC, an affiliate of Cerberus Capital Management II, L.P. DBRS considers the Servicer to be an acceptable collateralized loan obligation servicer.

The rating reflects the following:
(1) The Credit Agreement dated July 16, 2019.
(2) The integrity of the transaction structure.
(3) DBRS’s assessment of the portfolio quality.
(4) Adequate credit enhancement to withstand projected collateral loss rates under various cash flow stress scenarios.
(5) DBRS’s assessment of the origination, servicing and collateralized loan obligation management capabilities of the Servicer.

To assess portfolio credit quality, DBRS provides a credit estimate or internal assessment for each non-financial corporate obligor in the portfolio not rated by DBRS. Credit estimates are not ratings; rather, they represent a model-driven default probability for each obligor that is used in assigning ratings to a facility.

DBRS Morningstar notes that the above press release was amended on January 29, 2020, to correct the initial rating date to July 17, 2019, from July 16, 2019.

Notes:
All figures are in U.S. dollars unless otherwise noted.

The principal methodology is Rating CLOs and CDOs of Large Corporate Credit, which can be found on dbrs.com under Methodologies & Criteria.

The rated entity or its related entities did participate in the rating process for this rating action. DBRS had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the rating process.

This rating is endorsed by DBRS Ratings Limited for use in the European Union. The following additional regulatory disclosures apply to endorsed ratings:

This rating concerns a newly issued financial instrument. This is the first DBRS rating on this financial instrument.

For further information on DBRS historical default rates published by the European Securities and Markets Authority (ESMA) in a central repository, see: http://cerep.esma.europa.eu/cerep-web/statistics/defaults.xhtml.

Lead Analyst: Leila Manii, Assistant Vice President, U.S. Structured Credit
Rating Committee Chair: Jerry van Koolbergen, Managing Director, U.S. Structured Credit
Initial Rating Date: July 16, 2019

For more information on this credit or on this industry, visit www.dbrs.com or contact us at info@dbrs.com.

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