Investors have apparently given American Capital Access a strong vote of confidence, as the borderline single-A rated surety priced its new issue CDO today, following two weeks of seesawing headlines. ACA ABS 2004-1, a structured finance CDO, was brought to market by Merrill Lynch.

The senior triple-A class came at an impressive 37 basis points over three-month Libor. Sources report the deal was upsized to $450 million, from the $400 million announced the last week of April.

Today has been a significant day of news for the firm, which announced earlier that it had promoted Bill Tomljanovic to head its structured finance group and oversee the management and origination of ACA's CDOs, following the recent departure of Maryam Muessel, who had previously been running the platform.

ACA ABS 2004-1

Priced: 5/14/2004
Seller: American Capital Access (ACA)
Amount: $450 million
Manager: Merrill Lynch
Class Amount MDY/S&P/FTC Avg. Life Benchmark Guidance Spread Coupon Price Yield
A1 $315.00 Aaa/AAA/AAA 5.0y 3ML 37A +37bp n/a 100 n/a
A2 $49.50 Aaa/AAA/AAA 7.0y 3ML 60-65 +65bp n/a 100 n/a
B $47.20 Aa2/AA/AA 7.8y 3ML 90-95 +95bp n/a 100 n/a
C $18.37 Baa2/BBB/BBB 5.2y 3ML Low 300 n/a +325bp* n/a n/a
C2 $3.70 Baa2/BBB/BBB 5.2y Swaps n/a n/a +375bp* n/a n/a
PS $16.23 n/a n/a n/a n/a n/a n/a n/a n/a
Notes: SF triple-B range; Upsized from initial $400 million.
* Priced at discount; C classes shortened from initial 8.0-year.

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