New Star Financial is marketing $400 million of notes backed by loans to small and medium-sized enterprises, according to a presale report by Moody’s Investor’s Service.

Nataxis Securities Americas is the underwriter.

The deal, NewStar Commercial Loan Funding 2013-1, includes two tranches with preliminary ‘Aaa’ ratings: the $202.6 million class A-T is being offered at three-month Libor plus 165 basis points and the $35 million class A-R, a revolving classs of notes, is being offered at Libor plus 215 basis points.

Both tranches benefit from subordination of 40.60%.  

The remainder of the deal is not being rated by Moody’s.

New Star’s primary business is originating loans to middle market companies, and securitizing these loans is one of the ways it funds these loans. Since 2004 NewStar has issued and managed six collateralized loan obligations. It has over $2.4 billion of assets under management, represented by loans to over 240 obligors, and has originated more than $4.6 billion of funded leveraged loans since 2004.

The manager expects the portfolio of its latest deal to be approximately 55% ramped at closing in September.

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