SeaCube adds to mounting deal volume for marine cargo ABS
Marine cargo shipping container leasing firms are once again docking into the securitization market.
Three transactions secured by shipping container collateral and lease-contract receivables have priced this month, and a fourth has launched this week – bringing potentially nearly $2.3 billion of new bonds into an ABS sector that had been dormant for more than a year.
According to ratings agency presale reports, Seacube Containers – the d/b/a of Container leasing International – is marketing $300 million in fixed-rate asset-backed notes via Bank of America Securities, secured by portfolio involving 274,349 units with a net book value of $1.24 billion.
That follows three previous deals – two issues from Triton Container Finance totaling nearly $1.68 billion and a $450 million deal from Textainer Equipment Management. The Textainer issuance that closed Aug. 4 was the first publicly traded shipping container ABS portfolio sold to investors since May 2019.
CLI Funding VI LLC Series 2020-1 has preliminary A ratings from S&P Global Ratings and Kroll Bond Rating Agency.
S&P noted that the container leasing market has ongoing “resiliency and stability despite the macroeconomic disruption caused by the COVID-19 pandemic,” that has disrupted global trading. Although stay-at-home orders in many countries in Asia caused cargo container dislocations in those ports, and demand for goods dried up in the U.S. and Europe, most containers are on long-term leases that do not affect utilization or lease rates in the short term.
Those rates “may not be as negatively affected in the near term because there is currently a shortage of available marine cargo containers in the industry, with lower rates of production and many marine cargo containers parked but inaccessible at storage depots,” according to S&P.
More than 64% of the containers in the ABS are refrigerated units that have historically experience more stable demand and higher utilization rates, according to S&P.
The SeaCube deal is the first for CLI since May 2019, in a prior $300 million 2019-1 Series issuance.