TAL International is readying a $266 million container lease securitization, its third of the year.

S&P has assigned a preliminary ‘A’ rating to a $247.65 million tranche of senior notes and a ‘BBB’ rating to an $18.35 million subordinate tranche. All of the notes have a legal final maturity of November 2039.

RBC Capital Markets is the structuring agent; Wells Fargo Securities and Merrill Lynch, Pierce, Fenner & Smith join it as initial purchasers and joint bookrunners.

The notes are backed by a $1.38 billion portfolio containing 329,263 containers, which is shared with TAL’s four previous issuances.

Among the transaction’s strength, according to S&P, is the young age of containers in the portfolio, and the composition of the portfolio, which includes long-term leases and finance leases, which are shielded rate reductions during a downturn, and the diversified cargo container types. Among its weaknesses, the three biggest customers account for approximately 44% of the pool, and the fact that direct finance leases could be "recharacterized" as secured debt if the lessee files for bankruptcy.

TAL’s most recent securitization was completed in May; more recently, Cronos Containers completed a deal on Nov. 7. The senior, 4.5-year tranche of that deal, which was rated ‘A+’ by Standard & Poor’s, was priced to yield 3.3%, according to an Interactive Data report.

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