Channel, a lender specializing in equipment finance and working capital, completed its third working capital backed securitization, a significant milestone for the company. The $85 million issuance of asset-backed notes is collateralized by small business loans and advances across a wide range of industries.
The notes comprise four classes, each assigned ratings by Kroll Bond Rating Agency: AA (sf), A (sf), BBB (sf) and BB (sf). The transaction features a three-year revolving period and has the potential to expand up to $500 million. Truist Securities served as sole structuring agent and joint book-running manager, while Guggenheim Securities acted as a joint book-running manager.
“This transaction is a resounding testament to the capabilities of the Channel team in expanding volume and originating high-quality credits with attractive yields,” Eli Sethre, CFO of Channel, said. “It reinforces the strength of our business model but also highlights the increased recognition of the Channel brand among institutional investors and underscores our commitment to win together by delivering exceptional value that fosters trust the financial market.”
“This accomplishment is particularly noteworthy as it marks our first-ever AA rating on a securitization transaction. Additionally, we achieved an advance rate of 93.5% through our class C notes,” Mike McConnell, vice president of treasury and capital markets at Channel, said. “We appreciate the strong support from our existing base of investors and the ability to attract new investors as well. Overcoming a challenging competitive landscape to secure investors for a successful close further emphasizes investor community confidence in Channel and its asset class.”
