A securitization of a securitization is on the way to investors, as CLIF Holdings prepares to issue $145 million in bonds secured by residual cash flows from eight previous securitization transactions.
Subsidiaries of Container Leasing International, which does business as SeaCube Containers issued the previous underlying securitizations.
As of September 30, CLI owned or managed 944,722 units, with average utilization of about 98.9%, according to Morningstar DBRS, which rated the notes.
SeaCube had previously gone through an April 2013 transaction in which Ontario Teachers' Pension Plan Board (OTPP) acquired SeaCube and subsequently a December 2023 deal, where Wren House Infrastructure, an infrastructure investor purchased SeaCube from OTPP, DBRS said.
Just one tranche of notes will be offered to investors from CLIF Holdings series 2025-1H, which will be rated (P) BBB (low) (sf) from DBRS.
The previous securitizations include the CLI Funding VI, composed of series 2020-1, 2020-2 and 2020-3; and CLI Funding VIII, comprised of 2021-1, 2022-1, 2025-R, which are backed by a single pool of marine container collateral.
CLIF Holdings' capital structure includes overcollateralization, a restricted cash account that covers six months of interest on the offered notes and a liquidity account of $1 million.
The deal also includes early amortization triggers, DBRS said. If an asset base deficiency should emerge, an interest coverage ratio less than 2.0 to 1.0, and failure to fully repay principal and interest on the offered notes by September 2030, than an early amortization will occur.
As for the assets in the portfolio, refrigerated containers account for 63.91% of the portfolio, by aggregate asset value, DBRS said. Dry freight containers and generator sets account for 32.7% and 3.39% of the rest of the collateral, respectively, the rating agency said.
Long-term and finance leases are the primary types of financing underpinning the notes, at 94.4%, DBRS said.
In terms of obligors, the pool is relatively concentrated, DBRS said, as the five largest lessees account for about 55.62% of the collateral pool by AAV.
