KBRA Affirms Ratings for Avoca CLO XVII Designated Activity Company
31 Jan 2025 | London
KBRA UK (KBRA) affirms the ratings for six classes of notes issued by Avoca CLO XVII DAC. All notes have received timely interest distributions since the transaction closed.
Avoca CLO XVII DAC is a €547.4 million European cash flow CLO managed by KKR Credit Advisors (Ireland) Unlimited Company (KKR Credit Ireland or the collateral manager), a relying adviser of KKR Credit US (KKR). The CLO closed in October 2019 and exited its reinvestment period in April 2024. The notes were collateralized by a €550.0 million portfolio of European syndicated senior secured leveraged loans and bonds to corporate borrowers at the closing date.
As of the January 2025 trustee payment date report, the aggregate principal balance of collateral obligations is €521.6 million, and there is a principal cash balance of €7.3 million. The portfolio is comprised of assets from 218 obligors. Since the 2024 surveillance, the Class A/B Par Value Test has increased to 140.23% from 138.41%, primarily due to amortization of the Class A-R-R. The K-WARF of the portfolio has increased to 2470 from 2437 as of the the 2024 surveillance date, which represents a weighted average rating of B/B-.
The ratings on Class B-1-R-R and B-2-R-R Notes consider the timely payment of interest and ultimately payment of principal by the applicable stated maturity date, while the ratings on the Class C-R-R, D-R-R, E-R and F-R Notes consider the ultimate payment of interest and principal.
In performing the rating review, KBRA utilized its Structured Credit Global Rating Methodology, the Global Structured Finance Counterparty Methodology and the ESG Global Rating Methodology.
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